When Nick Slater started selling houses in King Creek on the NSW Mid North Coast a decade ago, a seven-figure price tag was “unthinkable”.
Key points:
- CoreLogic report finds median house prices in nine Mid North Coast suburbs have risen above a million dollars for the first time
- Regional Development Australia Mid North Coast chief executive Kerry Grace says unattainable house prices are exacerbating a homelessness crisis
- Regional housing markets showing stronger growth compared to capital city markets
Now, he says, it is the new norm.
“Around five years ago in the King Creek market, we would have seen the first property exceed a million dollars,” Mr Slater said.
“Then gradually, we started seeing the first properties sell for over two million.
The semi-rural area saw the median value of homes sold jump by $425,000 in the year to May, according to the latest data from CoreLogic.
King Creek is one of 170 regional house or unit markets across the nation to record a median value at or above $1 million for the first time.
The total number in regional areas is now 270.
It is a common trend in the area, with eight other Mid North Coast suburbs also joining the million-dollar median club: Sapphire Beach, Moonee Beach, Korora, Bellingen, Bonny Hills, Lake Cathie, Emerald Beach and Bonville.
Mr Slater said the rise was likely due to the shifting buyer demographic, with the area’s “acreage lifestyle” in a hinterland location near a coastal regional centre attracting Sydney’s retirees.
“The proportion of city buyers has increased immensely,” he said.
He said younger families were priced out of the area.
“These large homes on acreages are absolutely perfect for families,” Mr Slater said.
“However, over recent years, as prices have grown substantially, the market has become disproportionately skewed towards semi-retired and retired couples.”
Housing affordability crisis deepens
As house prices rise, the issue of affordability continues to plague many prospective buyers.
Regional Development Australia Mid North Coast (RDAMNC) chief executive Kerry Grace said unattainable house prices were exacerbating a homelessness crisis and an essential worker shortage in regional areas.
“There’s just such a lack of availability of housing in the market whether that’s the dire shortage of rentals or the amount of houses that are actually affordable for people to buy,” Ms Grace said.
RDAMNC’s survey of key workers across industries including healthcare, aged care, childcare, hospitality and agriculture showed many had been looking to buy property in the region but found it impossible in the face of low availability and skyrocketing prices.
“We’re hearing some harrowing stories of people who can’t find rentals or get into the property market,” Ms Grace said.
Ms Grace said the organisation’s research on the housing affordability crisis revealed not only a shortage of available accommodation but a problem of empty spaces in large homes.
Byron Bay continues to be popular
The Byron and Tweed region of NSW took out four of the top five median values in regional NSW.
Byron Bay houses topped the list with a median value of $2,741,847, up approximately $400,000 from this time last year.
Casuarina, Myocum and Suffolk Park also made the top five, with medians of above $2 million. Burradoo in the Southern Highlands had the fourth-highest median at $2,416,897.
The majority of the new regional million-dollar markets are concentrated in the regions Southern Highlands and Shoalhaven,18, Illawarra,16, and Newcastle and Lake Macquarie, 23 regions.
Posted , updated
This is the highest level on record in Zoopla’s dataset, which goes back to 1959, if you exclude flash points during the 2020 housing market shut down and between 2008 and 2013, just after the banking system’s near collapse.
The figures emphasise the strain fast-growing house prices has put on ordinary households. Rising values have made it both harder to be a first-time buyer and harder for existing homeowners to upgrade. The gap between the average first-time and second-step home has gotten significantly wider.
Moving costs have also increased as properties were pushed into higher stamp duty bands. In the year to April, there was a 47pc increase in stamp duty bills, an extra £1,587 per home mover, entirely down to inflated house prices.
Lower-income buyers are already struggling. The last time the gap between first and second homes was so great was during another period of economic stress, following 2008. Although this time, the British economy is not grappling with a global financial crisis – that is likely still to come. CEBR has forecast the UK will enter a recession this year.
This will bring more risks for the housing market, which has been underpinned by extremely high levels of employment.
And then there’s the cost of living crisis
It is the lower end of the market that is driving the decline of the market. Average priced and cheaper properties have seen the biggest drops in competition as the cost of living crisis erodes people’s buying power.
The largest slowdown has come in properties worth between £250,000 and £500,000. The share of properties that attracted three or more offers fell to 36pc last month, down from 41pc in May 2021. For properties worth less than £250,000, the share fell from 40pc to 36pc.
In what should come as no surprise to regular readers of this column, Australian house prices have declined for a second month in a row in June–and the pace of losses is accelerating sharply. According to CoreLogic’s market-leading daily hedonic index, dwelling values across the five largest cities fell by more than 0.8% in June following on from a 0.4% loss in May.
Once again, the steepest losses were in Sydney, where dwelling values dropped by a chunky 1.5% in June (vs -1.0% in May), and Melbourne, where home values fell by 1.0% (vs -0.7% in May). House prices in Australia’s two largest conurbations are therefore declining at a double-digit annualised pace. Since their peak earlier this year, Sydney dwelling values have now lost 3.1% while homes in Melbourne have declined by 1.9%. There is also clear evidence that what is destined to become the largest draw-down in Aussie housing market history is gradually extending to Brisbane, where home values look to be rolling over (see blow), and Perth, where prices are moving side-ways once again. Pity the poor home buyers who went out and borrowed vast sums on the basis of the RBA’s guidance that they would not lift interest rates until 2024 at the earliest.
Sharp house price declines are a very important signal for the RBA, which has stated that it will be watching housing conditions–and their impact on household spending–like a hawk. The housing market is, after all, the purest exemplification of the monetary policy transmission mechanism in practice. The RBA also looks to have backed-away somewhat from its fixation with a 2.5% “neutral” cash rate point estimate, which was being bandied around willy-nilly as some sort of reasonable target. In his most recent speech, the RBA’s governor, Phil Lowe, commented:
I want to emphasise though that we are not on a pre-set path [to a specific interest rate end point]. How fast we increase interest rates, and how far we need to go, will be guided by the incoming data and the Board’s assessment of the outlook for inflation and the labour market. As we make that assessment each month, the Board will be paying close attention to developments in the global economy, the evolution of labour costs and how household spending is responding to higher interest rates.
In October 2021 Coolabah forecast that national house prices would fall by a record 15-25% after the RBA’s first 100 basis points worth of rate hikes (see here and here). We expected those hikes to start in mid 2022 at the earliest. As it turned out, the RBA initiated the first hike in May 2022. Peak-to-trough housing cycles in Australia typically take 1-2 years, although much depends on whether the RBA starts cutting rates after it completes its monetary policy tightening process.
For over a decade we have warned investors to expect much more volatile Australian housing cycles as a result of the huge increase in household debt and the regime change in the interest rate elasticity of savings and spending decisions.
There have been some surprising claims that Coolabah’s housing forecasts are outlandish even though they are fully supported by the RBA’s own model of the housing market, which actually points to even larger price declines, and have been belatedly embraced by most bank economists.
Perhaps the craziest response to our forecasts has been the suggestion that Australians should expect house prices to rise, not fall, in response to interest rates increases. Setting aside the fact that this proposition has no logical basis, it is empirically eviscerated by case studies of rate hikes triggering house price falls in 2007-2008, 2010-2012, and 2017-2019. In 2017-2019 house prices dropped by 10-11% after APRA imposed macroprudential constraints that forced banks to materially lift their investment property loan rates.
We also know that interest rate cuts in 2008-2009, 2011-2016, 2019-2020, and 2020 all precipitated substantial appreciation in national dwelling values. It should be simple for even a child to understand the idea that as the cost of buying a home rises and falls, the value of the asset will adjust accordingly. The same principle also applies to equities: as the interest rate one applies to value the stream of cash-flows attributable to any company increases or decreases, the value of the shares in that company will also rise or fall.
This is indeed precisely why Coolabah forecast a 30-60% decline in US equities in December last year (see here, here, here, here and here)–because we projected that 10-year bond yields in the US would increase from their 1.3% level at the time to north of 3.2%. It is also why we were extremely bearish on our own asset-classes (specifically duration and credit), and other sectors, such as crypto…
The race upwards on the German housing market continues: new figures show that house prices increased once again in the first quarter of 2022. However, experts are seeing signs that the price rises could soon run out of momentum.
House prices rise more than 10 percent for fourth consecutive quarter
The cost of buying a house in Germany rose once again at the beginning of the year. Figures from the Federal Statistical Office (Destatis) show that the average house price between January and March 2022, excluding taxes and other fees, rose by an average of 12 percent compared to the same period of the previous year.
“This means that the rate of increase in the house price index was over 10 percent for the fourth time in a row,” the statisticians wrote. At the end of 2021, the year-on-year house price increase was 12,2 percent compared to the end of 2020, following previous annual rises of 12 percent and 10,9 percent.
Price increases gradually slowing down in Germany
However, there are some signs that a downturn could be on the horizon. Comparing quarter-on-quarter prices, Destatis found that prices for apartments and houses in Germany only rose by around 0,8 percent at the beginning of 2022, down from 3,1 percent in the fourth quarter of 2021 and 4,1 percent in the third quarter. “This indicates a slight weakening of the momentum,” Destatis concluded.
The recent sharp rise in interest rates is currently making mortgages more expensive and dampening demand for real estate. According to the online portal Immoscout24, demand for housing fell by 17 percent in the first quarter of 2022, compared to the same period in 2021. Real estate agents are noticing that housing listings are remaining live for longer, and it is becoming harder to find buyers.
Experts believe house prices could soon fall due to rising interest rates
“These developments could have a dampening effect on price developments in the medium term,” said ImmoScout24 Managing Director Gesa Crockford. The Landesbank LBBW recently predicted that house prices would fall in Germany if interest rates continue to rise while the economy stagnates. Their experts say we could be looking at price drops of as much as 20 to 25 percent.
Nonetheless, demand on the housing market currently remains well above the level recorded at the end of 2019, prior to the coronavirus crisis.
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U
K house prices will climb higher in 2022 than originally anticipated amid the ongoing national supply crisis, according to Knight Frank.
The property agent has revised its predictions after quarterly analysis of UK house price growth found the market was taking longer to recover from the distortion of the pandemic and the stamp duty holiday.
Knight Frank had originally forecast five per cent growth in 2022 but it has now pushed this up to eight per cent. In prime outer London, the firm has also increased its prediction for price growth to five per cent from four per cent.
In prime central London, it has revised its prediction to four per cent price growth from 3.5 per cent as the market continues to be buoyed by strong domestic demand.
With inflation at a 40-year high and interest rates at their steepest in 13 years, annual house price growth rose to 12 per cent in April, data from the ONS showed last week. Nationwide and Halifax also both reported double-digit growth in May.
Knight Frank said the revisions were underpinned by the low levels of new housing supply coming to the market, adding the UK had “largely failed” to keep pace with demand, particularly during the “frenetic conditions” of the stamp duty holiday.
Prospective sellers were often unable to find purchase options of their own, causing a vicious circle effect, it added.
However according to the agent, listings have picked up in recent weeks after the Bank of England’s recent decision to hike interest rates up to a new base rate of 1.25 per cent. “More sellers have come forward in the belief house prices may be peaking,” the agent added.
Tom Bill, head of UK residential research at Knight Frank, said: “We still believe annual growth will return to single digits by the end of the year as supply builds and demand is put under pressure by rising mortgage rates and spiking inflation.
“House price growth is peaking as supply rebuilds and mortgage rates normalise. But one lesson from the pandemic is that nothing reverts to normal overnight, which is particularly true in a relatively slow-moving market like residential property. We therefore expect a more gradual return to earth for prices.
“The distortive effect of low supply has also kept rental value growth high. A sharper slowdown in the sales market would have boosted supply and increased downwards pressure on rents as owners let out property that failed to sell for the asking price.”
As for renters, the forecast predicts housing stock levels to be particularly squeezed over the summer as high demand from corporate tenants and students exceeds available supply.
The firm has also revised its rental forecasts for London in 2022, and now expects rental value growth of 11 per cent in prime central London and 9 per cent in prime outer London, up from 8 per cent and 5 per cent, respectively.
Falling house prices tend to be bad for incumbent politicians during reelections. Take, for example, George H. W. Bush.
Vice President George H. W. Bush was elected president in a landslide in 1988. The U.S. housing market had been booming for years before that election. The Northeast boomed from 1986 to 1988, and California was also booming in 1988. Nationally, nominal house prices increased 14% in the 20 months from January 1987 until the election in November 1988, according to the S&P CoreLogic Case-Shiller Home Price Index.
Eight states voted for George Bush that haven’t voted for another Republican presidential candidate since then. Six of those states were in the Northeast, and one was California. All of those states saw big house price increases in the 1980s.
By 1990, however, house prices nationally had stopped increasing. Real house prices and family home equity wealth fell with the 1990 recession. The number of households losing real home equity wealth was far greater than the number of households losing jobs during the 1990 recession.
From November 1988 to November 1992, inflation-adjusted house prices had fallen 11% nationally, and 24% in metropolitan New York City. From January 1990 to November 1992, real house prices had fallen 22% in metropolitan Los Angeles.
Despite his landslide victory just four years earlier, President Bush lost the 1992 presidential election. A Bill Clinton campaign theme was, “It’s the economy, stupid.” It could have been, “It’s the home equity, stupid.”
House Prices And The 1992 Election
If house prices had been more stable and only increased more or less as much as the general inflation rate, what might have happened to George Bush in those two elections?
Would George Bush have still won in 1988? Probably. He won by a landslide anyway, and probably didn’t need a positive push from fast rising house prices to win.
But if house price inflation had been more stable and house prices didn’t fall during his presidency, would George Bush have won in 1992? Maybe.
It all depends on how important falling house prices were to the meteoric rise of Ross Perot. Perot got 19% of the popular vote in the 1992 presidential election even though he dropped out and stopped campaigning in the summer of 1992 for over two months! George Bush only lost to Bill Clinton by 6% of the popular vote.
If house prices hadn’t fallen and wiped out so much home equity and family wealth, would Ross Perot have gained any traction? How much of Perot’s success running as an outsider was fueled by homeowner anger at the political establishment over lost family wealth? When house prices fall some homeowners get mad at the world and want change.
Similarly, but more recently, how much did the much larger 2006 to 2011 house price declines and family wealth destruction cause the emergence of anti-establishment movements like the Tea Party movement and the Occupy Wall Street movement? How important were house price declines and family wealth destruction to the political success of Ross Perot’s populist successor, Donald Trump?
Current House Price Forecasts
Since January 2020, real U.S. house prices have increased about 50% faster than they did back during the height of the 1980s boom. Will we see a real estate bust like some cities saw back then?
Recently, some observers have mentioned the possibility of current house prices eventually falling 10% to 20%. That seems to be the consensus forecast right now. A 10% to 20% fall would be nothing like the fall during the real estate bust from 2006 to 2011 but it would be very similar to the fall from 1989 to 1993 for the United States.
From the top of the boom in the late-1980s to the bottom of the bust in the mid-1990s, real, inflation-adjusted house prices fell 14% nationally, although real house prices fell 31% in metropolitan New York City, and 41% in metropolitan Los Angeles. (House prices continued to fall after the 1992 election.)
Home equity fell much more for homeowners with mortgages, of course, because the amount you owe on your mortgage doesn’t fall when your house value falls. A small percentage fall in house prices can cause a huge percentage fall in your home equity and family wealth. Recent home buyers with small down payments can quickly go “underwater” and owe more on their houses than their houses are worth.
Today
Today, it’s mortgage rates that are skyrocketing, not house prices. Mortgage rates (30-year fixed-rate) are currently 5.8% and headed even higher given the Federal Reserve’s recent rate increases and statements. House prices have stopped increasing.
It’s hard to see how we can maintain 2022 house prices when interest rates are the same today as, for example, back in 2003 when real, inflation-adjusted house prices were 30% cheaper than today.
Since at least the 1980s, whenever U.S. house prices have increased exceptionally fast like they have in the last two years, house prices have fallen afterwards.
2024 Elections
Anything can happen but today it seems likely house prices will have fallen, or will be falling, during the 2024 election season. That would be a strong headwind for all incumbent politicians running for reelection just like it was for George H. W. Bush in 1992.
2022 Elections
What about the midterm elections this November? Consumer sentiment has fallen a lot which might make consumers more sensitive to any bad news on the housing front. House prices have likely peaked for this cycle so rising prices won’t be helping incumbents from here to the election. Although, house prices are unlikely to actually fall before the election, the number of houses for sale will likely continue skyrocketing and that could scare some already nervous consumers about the future value of their houses, their home equity and family wealth.
That means 2022 could be a tough year for incumbent politicians but it will probably be a lot less tough than 2024 will be.
Wales is still the region with the highest average house price increase across the UK, according to the house price index released by the Office of National Statistics (ONS) covering the year-on-year comparison to April 2022.
The data indicates during this 12 month period the average house price in Wales has increased by 16.2% to the record high of £211,990, a 2.2% increase since the March data. The volume of transactions decreased by 9.1% in Wales, suggesting the continuation of low stock supplies still fuelling rising house prices.
The UK average house price increased by 12.4% over the year to April 2022, which is up from the 9.7% figure reported for March 2022. The average UK house asking price was £281,000 in April 2022, which is £31,000 higher than for the same time in 2021.
READ MORE: Wales’ up-and-coming locations set to be the next UK property hot spots
(Image: Western Mail)
(Image: Google maps)
The next UK region to see the highest year-on-year growth to April 2022 is Scotland, also with a 16.2% increase to an average asking price of £188,000 which is a noticeable acceleration from this nation recorded as having the slowest growth in the year to March 2002 at 8%.
England has seen a 11.9% increase to bring its average house price to £299,000 and Northern Ireland is stated to have experienced a 10.4% growth in the 12 months to April 2022. London continues to be the region with the lowest annual growth at 7.9%.
James Briggs, head of personal finance intermediary sales at specialist lender Together, says: “The housing market continues to show how unpredictable it can be, as property prices rose to 12.4% in April, despite wider economic turmoil and inflationary pressures. However, I’d expect to see the increased cost of living, leading to squeezed household finances paving the way for a more sluggish housing market this summer.
“With consumer confidence at an all-time low and mortgage rates on the rise, buyers may be more hesitant in increasing their debt and instead may shift their financial priorities towards battling rising household costs.”
(Image: JJ Morris Cardigan / rightmove)
(Image: Aled Ellis & Co Aberystwyth)
But the market is hard to predict over the next six months even for property experts, with a tussle between the rising cost of living and inflation and falling wages in real-terms on one side and the lack of housing stock on the other side.
Managing director of estate agents Barrows and Forrester, James Forrester, says: “We can expect to see UK property values continue to hold their own over the coming months, as the supply demand imbalance continues to negate any wider economic influence.
(Image: purplebricks)
(Image: Country Living Group)
“For every one buyer struggling with the financial task of climbing the ladder, there are three or four with a mortgage in principle and an existing property to act as financial collateral in order to fund their ongoing purchase.
“It remains an incredibly competitive market and while we’re unlikely to see these extraordinary rates of house price growth persist in the long-term, bricks and mortar continues to provide a very sound investment.”
Whatever the next six months holds for the UK and Welsh property market one county in particular stands out as still riding the crest of a property price increase. With the Wales wide average price increase to April 2022 reported as 16.2% for this data period, Ceredigion lands a 23% rise, almost double the UK figure of 12.4%.
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The average house price in Ceredigion is now £259,724 according to the ONS data, although Monmouthshire remains the most expensive county in Wales with an average of £346,291.
Blaenau Gwent, another popular area since the Covid-19 pandemic due to the significantly lower than Welsh house price average, is close behind Ceredigion with a figure of 22.7%. The lowest increase was seen in Denbighshire, but that still experienced a 9.2% increase over the year to April 2022.
The Ceredigion coastal county has topped the list previously in January 2022 and is consistently seen within the top three to five counties of the monthly ONS house price index published figures.
1. Ceredigion: increase of 23% average price now £259,724
2. Blaenau Gwent: increase of 22.7% average price now £131,596
3. Vale of Glamorgan: increase of 20% average price now £304,037
4. Pembrokeshire: increase of 19.9% average price now £236,190
5. Merthyr Tydfil: increase of 19.6% average price now £147,341
6. Monmouthshire: increase of 17.6% average price now £346,291
7. Isle of Anglesey: increase of 17.5% average price now £237,866
8. Torfaen: increase of 17% average price now £192,358
9. Powys: increase of 16.9% average price now £238,189
10. Swansea: increase of 15.4% average price now £190,544
11. Wrexham: increase of 14.9% average price now £199,555
12. Caerphilly: increase of 14.4% average price now £175,694
13. Carmarthenshire: increase of 13.7% average price now £197,079
14. Gwynedd: increase of 13.3% average price now £204,313
15. Flintshire: increase of 12.7% average price now £207,657
16. Newport: increase of 12.6% average price now £226,869
17. Rhondda Cynon Taf: increase of 12.3% average price now £149,724
18. Cardiff: increase of 11.3% average price now £254,086
19. Neath Port Talbot: increase of 11.3% average price now £150,707
20. Conwy: increase of 11.3% average price now £204,178
21. Bridgend: increase of 10.7% average price now £193,297
22. Denbighshire: increase of 9.2% average price now £195,323
Daniel Rees from estate agents Savills is from Ceredigion and can see why it has become increasingly popular as a location to buy property. He says: “Ceredigion has a stunning coastline and idyllic countryside but people in Wales or further afield have only in recent years realised what it has to offer compared to some of the neighbouring counties.
“Improved transport connections and internet in the county mean people can both commute and work effectively from home while living in a beautiful part of Wales that offers a great quality of life.”
(Image: rightmove)
(Image: rightmove)
James Skudder from Country Living Group estate agents thinks the area is continuing to increase in popularity with buyers’ due to a package of benefits. He says: “We are seeing buyers who in large are not able to secure properties in what have traditionally been more popular areas, really widening their search parameters. The ONS figures are testament not only the unique variety of homes located here, but also the fantastic value for money for the properties on offer.
(Image: rightmove)
(Image: rightmove)
Nigel Salmon, director of Fine and Country in west Wales, specifically looking after Ceredigion, adds: “People becoming more adventurous in where they were prepared to buy and discovering the wild and wonderful area of Ceredigion where my family and I have lived for 20 years.
“Smallholdings, country houses and lovely cottages are all in abundance in the area and with people reassessing their lives during the pandemic geography was more academic for mobile buyers from around the country.”
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TEHRAN – The president, Parliament speaker and Judiciary chief on Sunday backed a government plan which set limits for increase in rental prices. It set a 25 percent increase in the capital Tehran and 20 percent in other cities.
The parliament (Majlis) also approved the general outlines of the plan on Wednesday and specialized parliamentary committees are going to study the pros and cons of the plan.
However, there is a serious doubt about how this plan, once finalized, is going to be implemented. Experience shows the people have serious doubts about such plans.
In the Rouhani administration it was announced that landlords are allowed to increase rental prices by only 15-25 percent. However, the order failed badly. Only a very small percentage of houseowners increased the price by that amount. They just acted based on their own conscience.
The plan failed just because there was no organization or institution to enforce or monitor it. Now, there is a great fear that the new plan may also find the same fate.
Rental prices have started going up dramatically from three years ago. However, increase in the current Iranian calendar year 1401 (which began on March 21, 2022) are more shocking than the years 1400 and 1400. Some landlords have incredibly increased prices by 100 percent. For example, in the early autumn of last year, a tenant could rent a 65-70-meter apartment in the Afsarieh region in southeast Tehran by a monthly payment of 3 million tomans (nearly 100 dollars) plus a 100 million tomans in deposit money (about 3,500 dollars). However, such an apartment is now being marketed or rented twice that amount.
Such sharp increases have caused anxiety and depression among the tenants, especially families with low income. Some families have been forced to leave cities, especially big ones, and rent a house in outskirts.
Now the key question is which inspection body will monitor the so-called the 20-25 percent increase in rent price, which has been put on the agenda of the government and Majlis?
Surely, the Majlis will ratify the details of the plan, but if its implementation is not effectively enforced by an inspection body it will prove a big failure and will intensify the public distrust of the responsible bodies.
In studying the plan, it is also necessary that the Majlis close all possible loopholes that may emerge in the implementation process.
Final days of spring up until the end of summer is known as the “season of movement”. Most landlords are fishing in the troubled waters. They propose prices which are much higher than the inflation rate. Also, most real estate agents fan the flames of higher rent prices because they get their own commission. For them, the higher the better.
Up until this moment, there has been no formula or criterion for setting rental prices. It is landlords who decide about prices. This is while that according to certain reports and remarks by some officials about 70 percent of tenants’ income goes up for renting.
It is true that supply and demand is very important in rental market, like any other market, but in such a situation in which the inflation rate is too high it is necessary that the government intervene in the rental market. Just asking landlords not to increase rents more than 20 to 25 percent will not work at all.
Being aware of the heavy burden on tenants and skyrocketing home prices, the Raisi administration has promised to build four million houses in four years of his presidency. Whether this goal will be realized or not, or is too ambitious, is a question that experts must answer. However, the performance of his administration in 10 months of his presidency is not promising. So far, the government is far behind its plan called National Housing Movement.
During these ten months, the Ministry of Transport and Urban Development has not even finished the remaining Mehr housing units, which some figures have put their numbers at 80,000. Reportedly, these housing units, which started more than a decade ago, are being abandoned and the customers are repeatedly being given unfulfilled promises. They are being said that they will be finished this year, another six months, three months later, and so forth. These unfinished houses are mostly in new cities in the provinces of Tehran and Alborz, which together house about 20 percent of the Iranian population.
Obviously, incompetence, corruption, repeated increases in prices of construction materials, and illegal sanctions are the main culprits for delays in finishing the remaining units, which are mostly of low quality.
Maybe one of the reasons for such repeated delays is that the current administration is mostly focusing on its own housing plan.
According to statistics given by a former official at the Ministry of Transport and Development in the early summer of 1400, about 8.5 families were tenants. MP Alborz Hosseini, who sits on the Parliament Development Committee, also said on Wednesday that 32 million out of 85 million Iranian population are tenants.
Naturally, the number of tenants is increasing as families cannot afford to buy a house.
However, both the Rouhani and Raisi administrations as well as the sitting and previous parliaments have been either ignorant or reluctant to make use of the experience of other countries in taming the wild housing and renting markets. There is a mechanism in economics called “taxation”. The executive officials and parliamentarians could have levied heavy taxes on the sale of houses in the form of value-added tax (VAT)to bring prices down. Or the parliament could and still can approve a legislation that would limit the number of houses that a person or family can have in his possession.
Moreover, some experts believe that the ratio between the population and houses is not that much that is causing so much anxiety for the tenants. They say the main reason is that certain people own tens or probably hundreds of houses, especially in the capital Tehran. Additionally, MP Ali Khezrian, talking in the parliament on Wednesday, announced that 3 million apartments are now empty and the owners refuse to sell them. Some have put this figure higher and claim there are four million such houses.
These people, who do not need professionalism or expertise, act like a mafia and hold the key for house prices.
Traditionally and truly there have been and still there is a view among the people that investing in real estate is the best and safest option. House is subject to a meager taxation and it is widely considered as a capital asset rather than a consumer good and this has been proven in the country.
To tame this wild horse and reduce the concerns of tenants and control house prices, probably the first urgent move is to ban the possession of more than two or three houses by a person for family. If officials’ interest really doesn’t lie in keeping more houses in the possession of a small percentage of landlords, they can adopt effective measures by using the experiences of successful countries in this regard.
Shocking new research reveals that people who own houses can earn more from their house price going up than they do from their salary, with prices going up £10 an hour in some regions
Image: PA)
Homeowners are increasingly pocketing more per hour from house price rises than they do from working.
New analysis shows house prices soared by almost £10 an hour in many regions last year due an explosion in the housing market.
The surge in house-price inflation is laid bare in new research carried out by analysts at House Buy Fast.
According to current data, many homeowners now routinely clock up more each hour through the rise in value of their property than they do from sitting at their desks.
People living in a property worth £289,099 – which is the current UK average – can expect to have seen their value increase by at least £19,842 over the past 12 months.
That breaks down as £9.88 an hour, £79 a day and nearly £400 a week.
Meanwhile the millions of Brits who now live in properties worth £425,000 have seen their value rise by almost £30,000 a year.
That is the equivalent of £560-a-week which, according to the Office for National Statistics is higher than the current UK average weekly wage.
Many who own properties worth between £850,000 to £1million are likely to have seen values rise at more than double the rate of the national average weekly wage over the past 12 months.
Commenting, Jonathan Rolande, the founder of House Buy Fast, said: “The house price surge over the past couple of years has been truly staggering.
“In very many cases homeowners are now earning far more an hour through the value of their property increasing than they are by going to work.
“To see house prices rising faster than the rate of wages in this way is bittersweet.
“On one hand it underlines, once again, the strong position those owning their own home now find themselves in.
“But on the flip side it shines a light on the struggle many trying to enter the market face.”
House Buy Fast have also created a free-to-use calculator which lets users see how much their home has risen in value over the past year.
Buyers and sellers can also track any changes and keep note of the impact of any changes by the year, week, day and even working hour.
In March figures showed that house price rises had outstripped wage growth in more than 90 per cent of England and Wales.
Kensington and Chelsea remained the least affordable local authority area in England and Wales, with average house prices estimated at 36.5 times the typical annual wage.
Last month it was reported that the average UK house price hit a fresh high, rising for the 11th month in a row.
House prices increased by one per cent between April and May, or £2,857, taking the average price of a home to a record of £289,099.
While annual house price growth remains at the elevated level of 10.5 per cent, this is the slowest rate of growth since the start of the year.
Northern Ireland topped the table for annual house price inflation again in May, after prices rose by 15.2 per cent over the past 12 months, taking the average above £185,000.
This was followed by south-west England, where there was annual growth of 14.5 per cent, taking the average price above £305,000.
Meanwhile, average house prices in Wales rose to a record level of above £216,000 after a 13.7 per cent increase over the past year.
House hunters in London will need £247,638 more than they did 10 years ago.
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House prices in the UK have climbed for the fifth month in a row and have now reached a new record high. The average price of a property across the country is now £368,614 according to Rightmove, which has gone up by £1,113 in the last month.
With the cost of living crisis putting a strain on our finances, buying a house at this price is considered unaffordable for many. Thankfully in Greater Manchester there are some cheaper areas where house hunters can find a home for much less than the average house price.
You can typically expect to buy a home for a much more reasonable price in the boroughs of Bolton, Oldham, Rochdale and Wigan, as these are considered the cheapest areas to live. However there are bargains to be had across the whole of Greater Manchester.
READ MORE: Most expensive home for sale in every Greater Manchester borough – with one as much as £5,850,000
We’ve picked out some properties that are currently on the market across the region for £100,000, which are ideal for house hunters and first-time buyers on a budget.
Some of these homes are considered ready to move straight into whereas others may need some TLC, making them great projects for buyers wanting to give a home a complete renovation.
Turf Lane, Chadderton, Oldham
(Image: Purplebricks / Rightmove)
In the town of Chadderton, £100,000 can buy you a three bed home. This end terrace house requires a bit of work doing to it however it has the potential to make a great starter home.
Fairly spacious for its price, the property has a porch, living room and kitchen dining room on the ground floor, with two double bedrooms, a single bedroom and one bathroom upstairs.
(Image: Purplebricks / Rightmove)
It is in a residential area within easy access to schools and public transport links and also benefits from a decent sized garden at the back.
Estate agent Purplebricks say the property needs cosmetic work but benefits from no chain and is likely to ‘sell quickly.’
Old Lane, Little Hulton, Salford
(Image: Rightmove / Stone Cross Estate Agents)
A two-bed home in Little Hulton is on the market for £100,000. Listed as an ideal property for first-time buyers of investors, the end-terrace home is located within easy reach of Walkden town centre as well as shops, schools and amenities in Little Hulton.
On the ground floor there is a lounge and kitchen dining room with stairs then leading up to two bedrooms and one bathroom. There is also a small garden to the rear.
(Image: Rightmove / Stone Cross Estate Agents)
Offered with no chain, buyers can easily renovate the house to suit their individual taste.
Lodge Street, Wardle, Rochdale
(Image: Rightmove / Ryder & Dutton)
This two-bed apartment in Wardle could be considered a bargain for £100,000. The first-floor flat is housed into the Shaw Lodge complex and is fitted with striking modern interior.
Described as the ‘perfect purchase’ for a buy-to-let investor or first time buyer, the spacious apartment has a large open plan lounge and kitchen area, a bedroom with an en-suite shower room, a second good-sized bedroom and a bathroom.
(Image: Rightmove / Ryder & Dutton)
The property has been much improved by its current owner and is in move-in ready condition.
Located in the heart of Wardle village, the apartment sits within walking distance of local amenities including highly rated schools and is just a few minutes drive away from Rochdale and Littleborough town centres.
Mather Street, Failsworth, Oldham
(Image: Rightmove / Auction House)
A three-bed property in Failsworth has come on the market with a guide price of £100,000. This spacious home will appeal to first-time buyers and small families and benefits from being close to local amenities and transport links.
On the ground floor of the end-terrace house there is an entrance hallway, lounge and dining area and a kitchen. Upstairs are three bedrooms and one bathroom. Outside the home has a driveway to the front and a garden with a patio area to the rear.
(Image: Rightmove / Auction House)
This home is set to go to auction on July 5 and is opening for viewings this month.
Gordon Street, Leigh, Wigan
(Image: Purplebricks / Rightmove)
Although in need of a little updating, this two-bed property in Leigh is a great bargain for £100,000 and is an ideal first home.
The mid terrace property is fairly spacious with a 767 square foot living room and kitchen dining room on the ground floor.
(Image: Purplebricks / Rightmove)
On the first floor, the landing gives access to a bathroom, one large double bedroom and another good-sized bedroom. The rear garden is also a generous size and has been well maintained by its current owners.
St Johns Street, Lees, Oldham
(Image: Rightmove / Lees N P Estates)
Taking offers in the region of £100,000, this semi-detached home needs a lot of work but has the potential to make a lovely family home.
Located in Lees village, the property which was built in 1730 is open to cash buyers only and is ideal for someone who is prepared to take on a big renovation project.
(Image: Rightmove / Lees N P Estates)
Originally a former shop with a flat above, it could suit a variety of new uses including a conversion into a residential three-bed property or two separate flats.
Currently there is a large shop area to the ground floor and four rooms up on the first floor. Outside the property has a garden to the rear and a detached garage.
Huxley Street, Clarksfield, Oldham
(Image: Rightmove / Wild & Griffiths)
This terraced home in Oldham is on the market for £100,000 with the benefit of no chain.
Although in need of renovating, the two-bed home could be a great starter property for a first-time buyer or house hunter on a budget.
(Image: Rightmove / Wild & Griffiths)
The ground floor includes a lounge and kitchen dining room, with two bedrooms and one bathroom upstairs. There is also another staircase that leads to an attic room.
Outside there is a small paved area to the front and an enclosed garden to the rear.
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