Weekly Property Newsletter 22 April

Zoopla shares in rapid rise after CMA’s open letter to agents

22nd April 2016

Zoopla shares rapidly increased yesterday on the publication of the open letter to estate agents by the Competition and Markets Authority. The letter warned agents that they must not collaborate with each other when making portal choices, including which one to drop.

Zoopla’s shares, which had moved comfortably up during the earlier part of the morning from 270p to about 280p, then started going up sharply, hitting a high of 292.60p before finishing the day at almost 290p.

Rightmove shares also shifted up at about 11am, having started the day, 3,870p. They finished yesterday up 9p at 3,879p.

City analyst William Packer had yesterday predicted that Zoopla’s share prices would respond favourably, however separately, Barclays has downgraded Zoopla from ‘overweight’ to ‘equal weight’.

The bank said it still sees an attractive long-term story, but says that the key driver for Zoopla is property.

Barclays said it expects to see only low growth this year in advertising rates paid by agents, “a reminder of the lack of pricing power for a battling no. 2″.

Credit: http://www.propertyindustryeye.com/

Dodgy home buyers will have to explain how they got their wealth

22nd April 2016

Home Secretary Theresa May is to consult on new ‘unexplained wealth’ orders, which would give extra responsibilities to estate agents and lawyers meaning that suspected money launderers could have their money and properties seized if they cannot prove that their wealth is legitimate.

Mark Hayward, managing director of the NAEA, said: “We welcome the aggressive powers that the Home Office have proposed to tackle money laundering in the UK.

“The entry of corrupt money in the UK has a very real impact not just on the property market but also on the wider community when properties are left empty for long periods.

“And importantly, if someone is unable to explain the source of their wealth they could be at risk of forfeiture.

“This is a good thing and we will work alongside other stakeholders such as the National Crime Agency to make it as effective as it can be.”

Both the NAEA and RICS have been conducting their own investigations since last July, when the ‘From Russia With Cash’ C4 programme allegedly showed agents assisting a clearly dodgy buyer – in fact an actor – with his purchase.

Credit: http://www.propertyindustryeye.com/

Members of public approve of Stamp Duty surcharge on second homes

22nd April 2016

The Stamp Duty surcharge on second homes is popular with the public, it has been claimed.

A survey for the HomeOwners Alliance shows that more than twice as many people support the 3% surcharge than oppose it.

According to the poll, 47% are in favour of it and 18% are against it, with the remainder being neutral.

In the south-west, which has a high proportion of holiday homes, 59% of the public support the surcharge.

The survey, also conducted for BLP Insurance, was by YouGov which polled just over 2,000 adults.

Paula Higgins, chief executive of HomeOwners Alliance, said: “The British public believe that homes are for living in and not speculating with.

“The Stamp Duty surcharge might be bad for landlords but it will allow more young people to realise their dream of owning the roof over their head.

“This is why we initially called for the tax system to differentiate between aspiring home owners and property investors. However, we must see the money raised ploughed back into building more affordable housing.”

Credit: http://www.propertyindustryeye.com/

Residential property sales and mortgage lending both soar

22nd April 2016

There were 165,480 residential property transactions in March, HMRC has said.

The ‘seasonally adjusted’ figure was 41.5% up on February, and 69.7% higher than March last year.

On a non-adjusted basis, there were 161,990 transactions in March, up from 92,690 in February – a rise of 74.8%, and 77.1% higher than March last year.

HMRC said the large increase in transaction was “likely” to be associated with the introduction of the Stamp Duty surcharge on second properties, introduced on April 1.

Separately, the Council of Mortgage Lenders reported that gross mortgage lending leapt 43% in March compared with February, and 59% compared with March 2015.

Credit: http://www.propertyindustryeye.com/

Landlords count their happy returns as property prices rise

22nd April 2016

Landlords starting or building their buy-to-let portfolios may have been clambering to beat the Stamp Duty deadline in April but according to some agents, it has helped boost existing property investors.

The latest Buy to Let Index from Your Move and Reeds Rains, shows the March rush to complete buy-to-let transactions means landlords sitting pretty will have seen total returns rise to 12.2% year-on-year.

This is up 10.7% from February and is also the fastest annual rate of return for existing landlords seen since November 2014, when the same measure last reached 12.3%.

While property prices may have increased, boosting total returns, rental yields have actually dropped from 5.1 % last year to 4.9% in March, the index reveals.

Credit: http://www.propertyindustryeye.com/