Docklands News

House prices fell for the first time in more than a year in October, according to figures from the Nationwide Building Society. The average price dropped 0.9% to £268,282 last month, while year-on-year growth slowed from 9.5% to 7.2%. Robert Gardner, Nationwide’s chief economist, said a “sharp rise” in mortgage rates has had an impact, commenting: “Higher borrowing costs have added to stretched housing affordability at a time when household finances are already under pressure from high inflation.” Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said the fall in prices “provides the strongest signal yet that house prices will buckle in the face of the surge in mortgage rates and the squeeze on real disposable incomes.” 

BBC News (01/11/2022)   Daily Mail (01/11/2022)   Financial Times (01/11/2022)   The Daily Telegraph (01/11/2022)  

Almost two in five new mortgages are being taken out for 30 years or more as homeowners turn to ultra-long deals to keep down monthly repayments. Traditionally borrowers have signed up for 25-year loans, but the number of households seeking out longer terms has more than doubled since 2007. More than 22,000 home loans agreed in July – 39% of the total – were for 30 years or more, according to trade body UK Finance. Some of these were for 35 and even 40 years. In July 2007 the total was 10,000. Brokers say more homeowners are extending the length of their deals when remortgaging to ease the pain of soaring rates, but warn that they will pay much more interest in the long term. 

Daily Mail (29/10/2022)  

City A.M. interviews Uma Rajah, the CEO and co-founder of CapitalRise, about how the prime central London market remains strong despite Brexit, Covid and market mayhem. Rajah said the firm is seeing “high demand” right now, having processed £46m in loans two weeks ago, and said its resurgence can be seen with a 71% growth in prime central properties since the pandemic. Uma said the market is not immune to the financial turbulence, adding that: “rising interest rates makes borrowing more expensive” and “that has a massive impact on all areas of the property market.” However, she said in the prime property market “people tend to borrow less because of the level of affluence.” She also warns that energy crisis may however have a secondary impact on the industry, with “general cost inflation” being a major factor in redevelopment and regeneration of undeveloped high-end assets. 

City A.M.  

Hamptons has revealed that the number of millionaire postcodes in London has risen again in 2022, with the average house price in nearly half of the capital's districts now over £1m. Analysis shows that 41% - or 113 - of the capital's 274 postcode districts are now £1m-plus areas, up from 24% a decade ago. The data shows how millionaire neighbourhoods are now spreading out from Zone 1, where the average house in every area has cost at least £1m since 2017, to new postcodes in Zones 3 to 6. New entrants this year in Zone 2 include Bethnal Green, where the average house price rose from £894,580 in 2021, to £1.03m in 2022. In the former dockland area of Wapping the average house has reached £1.09m, up from £972,840 in 2021. Hamptons' senior analyst David Fell, it is unlikely that many new neighbourhoods would join the seven-figure club next year, given the low expectations of price growth. 

London Evening Standard  

New data reveals that house prices are rising fastest once again in and around city centres, and falling in some suburbs, as the Covid "race for space" goes into reverse. During the pandemic, lockdown restrictions and the shift to home working drove stronger house price growth in suburban and rural areas. However, analysis by Halifax found that since the beginning of this year, property prices in cities have climbed by 9.2%, but prices in surrounding areas have risen by 7.9%. Andrew Asaam, Halifax's mortgages director, said: "As daily life started to get back to normal for many, the opportunity to live in cities became more attractive again, driving up demand." Halifax found that house prices in Manchester have risen by 11.5% so far this year, but just north of the city, prices in Bury are only 1.5% higher. In Scotland, prices in Edinburgh have increased, on average, by about 12.9% in 2022, compared with a rise of 6.1% in the outskirts. There were some exceptions however. In the North East, house price growth in Newcastle and Sunderland underperformed compared with surrounding areas. 

The Times   The Daily Telegraph  

New analysis shows how areas with high numbers of cash buyers and mortgage-free homeowners are the most immune to a house price crash in the UK. Hamptons ranked every local authority in England by six factors, including the share of mortgage-free homeowners, the share of cash buyers, and the pace of house price growth since the end of 2019 to find where house prices will be most protected from price falls over the next two years. The London Borough of Kensington and Chelsea, where an average home costs £1.39m, was named as the place that is best protected from house price falls. Here, 69% of homeowners are mortgage-free, compared to 54% across England and Wales. Two-fifths of buyers (43%) are also purchasing in cash, meaning their spending power will be unaffected by rising mortgage rates. The second most-protected property market is South Lakeland, in Cumbria, where more than two thirds (68%) of homeowners are mortgage-free, with 42% of buyers purchasing in cash. The buyers that are borrowing are using mortgages worth only 29% of the property's value on average. Three of the top 10 areas are in the South West – West Devon, East Devon and Stroud, where homes cost £305,580, £359,150 and £339,740 respectively. 

The Daily Telegraph