Aurelia Butler

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LONDON (Reuters) – British home prices will make solid gains in the next two years, outpacing overall inflation, but affordability for first-time buyers is likely to improve based on expectations for lower borrowing costs, a Reuters poll of housing market experts forecast.Those saving for a cash deposit and wanting to get on the property ladder face rents increasing at an even faster pace, however, eating into disposable income and making it harder to save the money needed to be granted a mortgage.Home values would rise 2.5% this year and then 3.0% in 2025 and 4.0% in 2026, the Aug. 19-Sept. 3 poll of 21 analysts predicted, largely unchanged from a May survey. Consumer inflation was predicted at 2.3% next year and 2.0% in 2026, a separate Reuters poll found.”There is likely to be a modest surge in prices next year as interest rates fall back a bit,” said Mike Scott at estate agency Yopa.Like its peers the Bank of England raised borrowing costs sharply after the COVID-19 pandemic to combat inflation but trimmed Bank Rate last month and is expected to do so again once more this year. By the end of 2025 it is forecast to stand at 3.75% versus the current 5.00%.”It’s the fall in mortgage rates that has provided a small boost to the housing market and seems to have set a firm floor under future price falls,” said Aneisha Beveridge at Hamptons estate agency.British home prices unexpectedly fell in August in their first monthly drop since April but the outlook for the property market is likely to strengthen, mortgage lender Nationwide Building Society said on Friday.With interest rates falling, affordability for first-time buyers would improve, 15 of 17 respondents to an extra question said.”As wages continue to increase above the rate of inflation and the Bank of England reduces rates further, with house prices only just in positive territory, logic says affordability is improving,” said Russell Quirk at estate agency Emoov.Incomes were expected to rise 4.8% in 2024 and 3.2% next year, the other Reuters poll found.Valuations in London, long a draw for foreign investors, are also forecast to increase, by 1.8% this year and 3.2% in 2025. In 2026 they are predicted to rise 3.5%.”As for London, it is ‘back’ and given a world on fire, the UK capital is also a more and more popular safe haven,” said Tony Williams at advisory firm Building Value.Average home prices in London have risen from around seven times median income in 2002 to about 13 times last year, according to data from the Office for National Statistics.Nationally, rents would rise far faster than home prices, increasing 6.0% in the coming year, the survey predicted.”There is a dramatic shortage of houses/flats for owner-occupiers, but it is even worse in the rental market because so many landlords are exiting the market due to regulatory changes,” Williams added.Prime Minister Keir Starmer’s government plans a Renters’ Rights Bill that will remove the threat of arbitrary evictions and make it illegal for landlords to discriminate against families with children, while insurers have pulled back from offering cover, particularly for residential landlords.Starmer has pledged to boost the supply of cheap properties, building 1.5 million homes in his parliamentary term, and shake up planning laws.(Other stories from the Q3 global Reuters housing poll) More

Salameh has been charged in Lebanon with financial crimes including money-laundering, embezzlement and illicit enrichment. He has denied all wrongdoing. Neither he nor his lawyer immediately responded to Reuters attempts to reach them for comment on Tuesday.The judicial source said that Salameh was arrested at Lebanon’s justice palace following a hearing about the central bank’s dealings with Optimum Invest, a Lebanese firm that offers income brokerage services, according to its website. The source said that Optimum had dealt with Lebanon’s central bank to buy and sell treasury bonds and certificates of deposit in Lebanese pounds. Optimum did not immediately respond to a Reuters request for comment. An undated statement on its website said that a financial audit had found “no evidence of wrongdoing or illegality” in the company’s dealings with Lebanon’s central bank. Salameh, 73, was Lebanon’s central bank governor for 30 years until July 2023. In his final months as governor, France and Germany issued arrest warrants for him on corruption charges. More

BENGALURU (Reuters) – Home prices in Canada will barely rise in 2024 and only modestly in coming years despite expectations for many more interest rate cuts, with affordability improving but remaining stretched, according to analysts polled by Reuters.After surging nearly 55% during the COVID pandemic, average prices in Canada’s interest rate-sensitive housing market have declined only 14% from an early 2022 peak despite 475 basis points worth of Bank of Canada rate rises through July 2023.Housing affordability is at around its worst since 1990, according to the BoC’s own index. Two 25-bps rate reductions since June, and expectations for another on Wednesday followed by several more later this year and into 2025, have done little to spur demand despite some signs of improving supply.Average Canadian home prices, which are down 1% this year so far, will rise around 1% in calendar year 2024, according to the Aug. 19-Sept. 2 poll of 14 analysts. If realised, that would lag overall inflation, expected to be 2.5% this year.Home prices are forecast to climb a median 2.8% and 3.0% in 2025 and 2026, respectively – broadly unchanged from a May poll.”Interest rate cuts have so far failed to stimulate the housing market, although the sharper drop in borrowing costs … will lend more support,” said Olivia Cross, a North America economist at Capital Economics.”Even after the latest drop in borrowing costs, affordability is far more stretched than prior to the pandemic … Accordingly, we expect price gains to be modest.”Improving supply alongside anaemic demand could put downward pressure on prices over the coming years.While housing starts jumped 16% in July on a monthly basis, according to the Canada Mortgage and Housing Corporation (CMHC), and new listings rose nearly 1%, home sales fell 0.7%, Canadian Real Estate Association data showed.More supply could come as many Canadians, at risk of sharp rises in borrowing costs over the coming years due to mortgage renewals, are expected to list their properties for sale. Roughly C$300 billion ($222.4 billion) of mortgages will come up for renewal next year.In Canada, mortgages are typically for 25 years and renewed every three or five years, unlike the U.S. where homeowners can enjoy a flat rate for a 15-year or 30-year mortgage.All 10 analysts but one said purchasing affordability for first-time homebuyers would improve over the coming year. But the question remains on how significant this will be.”More interest rate cuts are likely to stimulate homebuyer demand across the country. But, we expect this will be gradual,” said Rachel Battaglia, an economist at RBC.”Significant reductions in rates will be needed to make a noticeable difference in ownership costs, especially in Canada’s priciest markets.” Persistently high house prices could apply further pressure on rental markets, which may keep rents rising faster than home prices over coming years, according to some respondents. (Other stories from the Q3 global Reuters housing poll)($1 = 1.3488 Canadian dollars) (Reporting and polling by Indradip Ghosh; Additional reporting by Mumal Rathore; Editing by Ross Finley and Mark Heinrich) More