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House prices up again -
Annual house price inflation touched
12.1% in February 2007 in a statement released by the government yesterday.
The official measure of completed house price sales shows that the housing
market has begun 2007 in buoyant fashion. On a National Basis, London leads
the way again with prices in the suburbs also showing strong results as
home buyers look for better value. Recently released data from a number of
the major building societies does show however that the three interest rate
rises that have been applied since August 2006 may now at last start to cool
the housing market. The Bank of England are keen to see a cooling in house
prices and it is widely expected that they will shortly announce a further
rate increase.. Figures also released suggest that the number of first time
buyers has also dropped which lends weight to the argument that homes are
now beyond the reach of many people . A year ago, as much as one third of
purchases where to first time home buyers, that figure has now dropped to
approximately 21%. To a certain extent the
property market is driven by the first time
buyer and any sign of slow down in this area of the market will have
repercussions, further up the chain.. The market is difficult to predict ant
the moment, interest remains strong but there is a limited amount of
property coming on to the market and this may be having an adverse effect on
prices.
European commercial property showing
strong gains - Once again European property
has had a strong year. The five countries ( United Kingdom, Ireland,
Denmark, Sweden, Netherlands) covered by the IPD National report have all
shown increases over their 2005 results. Although returns in Denmark &
the United Kingdom were slightly lower than in 2005, all 5 countries showed
high returns ( the lowest was 17.8%) . All of these markets have experienced
a fall in yields which has had a result of pushing up capital values.
Despite the threat of interest rate increases, investors are still keen on
European property, many are joining the market for the first time , keen to
become involved because of the upswing in Commercial Property rents.
Spanish Economy at 29 year
High - The Spanish prime
minister, Mr Jose Zapatero has reported that the Spanish economy is running
at a 29 year high. In 2006 the economy grew by 3.6 % and Spain is now the
eighth largest economy in the world with a gross domestic product in excess
of 1,000 billion euros. Signs in Spain show that the economy is becoming
less reliant on the
construction industry and unemployment at
8.5% is the lowest since 1979. Mr Zapatero reported that his government were
committed to sustained growth in 2007 and wanted to make the economy more
efficient by investing in Infrastructure and education.
Is water a problem for New Spanish
Homes ? - At the present moment,
there are as many as 300,000 new homes being built across Spain that are
being built without a definite guarantee of being supplied with water. This
information has been released by the Spanish environment agency. There
are at least 129 municipalities, most of them in the south east provinces of
Valencia and in the basin of the river Tajo in central
Spain. The general coconscious of opinion is that there is
plenty of water in Spain but water wastage rather than eater shortage is the
main problem. The government has stated that agriculture will receive
priority for water over hosing developments. Droughts are common in parts of
Spain, particularly in Valencia, Murcia and the Tajo, however the recent
heavy rains may have brought some relief following a practically rainless
summer. In regions bordering the Atlantic in the west, rains have restored
reservoir levels to over 80%. However Mediterranean regions are still
suffering with some as low as 11.1% full.
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