Housing valuation activity levels increase in May

A recent report has shown that the level of mortgage valuation activity increased for the months of May, reflecting the sixth month in a row where this activity has seen an increase. The data was released by Connells Survey and Valuation, which recently released its Housing Market Activity report.

The report showed that when it came to mortgage valuations the month of April had seen activity remain largely flat. However, this changed in May with the number of mortgage valuations said to have increased by around 22 percent compared to the previous month. Compared to the same period last year, the number of valuations in May increased by 26 percent. This will most likely be taken as another positive sign of some level of recovery in the property market in the UK.

The data showed that one of the reasons behind the increase in activity was a marked increase in interest from first time buyers in the market. In total first time buyers made up 34 percent of all valuation activity according to the report. However, the figure was further boosted by existing homeowners who were looking to move home. There was an increase of around 11 percent on valuations for house movers for May compared to the previous month.

An official from Connells stated: “Housing market activity has resumed its slow and steady upwards trajectory, driven by an upturn at the lower end of the market. Many first-time buyers have been encouraged to enter the market by the uptick in the number of higher LTV products available recently. However, for the average first-time buyer, mortgage finance still presents a formidable challenge. The increasing variety of products is offset against comparatively high rates – alongside overly stringent criteria demanded by lenders.”

Tags: property market, steady upwards trajectory, Real estate, Business Finance, variety, homeowners, number, percent

Property prices end 2010 on low

It has been revealed by a major High Street lender that property prices in the UK ended last year on a low, having slid from the start of the year. The price of property in the UK was said to be around 1.6 percent lower at the end of 2010 than at the start of the year. The data was released by the banking giant Halifax, which said that property prices fell by 1.3 percent in December compared to the previous month.

It is thought that property prices have been driven down by a number of factors. One of these is that many homeowners are flocking to sell their homes whereas there is a distinct lack of interest from buyers. This is because many buyers are unable to get the mortgage finance that they need due to continued restrictions in the mortgage market, and many others simply don’t want to make a huge financial commitment in the current financial climate and with the uncertain future with regards to jobs.

A spokesperson from the Halifax said that if homeowners become more reluctant to sell this year the falling property price trend could be halted. He also said that it was unlikely that there would be much change in terms of movement in the property market over the course of this year, and this was because interest rates were unlikely to change.

The Halifax said: “Current signs that homeowners are becoming more reluctant to sell would, if continued, help reverse the imbalance between buyers and sellers. Nonetheless, uncertainty about the economy, weak earnings growth and higher taxes could put some downward pressure on demand.”

Another mortgage expert added: “While there has been an easing down of prices, as supply has come through and demand has weakened, in certain towns and cities, not least the capital, the right type of property is still commanding the right sort of price.”

Tags: percent, climate, Real estate, mortgage, end, type, future, earnings growth

FSA cracks down on sale and rent back schemes

Over the past few years an increasing number of people have had to turn to sale and rent back companies to try and get themselves out of a sticky situation with their homes. Read more

Tags: sale and rent back, home insurance, Renting, finance, Real estate, Financial Services Authority

Are you hoping to get onto the property ladder this year?

Over the past couple of years first time buyers have been hit with a whole new problem. Following years of lack of affordability because of the sky high value of properties many first time buyers probably thought that their time had finally come when property prices started to plummet. Read more

Tags: Mortgage loan, mortgage, Real estate, Subprime crisis impact timeline, first time buyer

House prices could take years to recover according to Bloomberg survey

A survey from Bloomberg has suggested that property prices in the UK could take a number of years to recover back to the level that they were at back in 2007, before the credit crunch hit. Since around October of 2007 house prices have plunged in the UK, although the last few months have seen some nominal increases in property values. Read more

Tags: house prices, housing market, economics, Real estate, Bloomberg

House price bubble formed due to higher demand for property in UK

Recent reports have indicated that s house price bubble is being formed in the UK, with the main cause of this being the high demand for properties compared to the low supply from sellers. Read more

Tags: Danish property bubble of 2000s, Real estate, Estate agent, Real estate bubble, Real estate economics, National Association of Estate Agents

Report claims lenders being less stringent over home loans

Whilst lenders have been exercising increased stringency when it comes to home loans and other types of finance since the onset of the global credit crunch a recent report has suggested that some lenders may be easing up on their lending criteria now. Read more

Tags: housing, Mortgages, stringency, industry officials, Real estate, 100 percent mortgages

An increasing number of privately renting tenants are getting evicted

A recent report has shown that there has been a rise in the number of privately renting tenants that are being evicted from their rented homes, and this is causing concern amongst many industry officials. Read more

Tags: industry, unfairness, Real estate, tenant evictions, Business and Economy, buy-to-let, shelter, home

You don’t have to sell up to make money from your home

The years of the property boom seem like they were a long time ago, but in reality it has only been a couple of years since the property bubble exploded with a resounding bang. During the years of the boom many homeowners in the UK made a killing on their investments, having seen the price of property soar in the UK. However, with property prices having plunged many have lost some or all of the equity in their homes, and this has left them unable or unwilling to sell their homes. Read more

Tags: Loss mitigation, Renting, advertising boards, Real estate bubble, mortgage, Real estate

Are you looking to refinance your mortgage?

People in the UK have become far more savvy about finances over the years, and when it comes to mortgages many people have realized that there are some great deals out there that could save them a fortune in interest as well as reducing their monthly repayments. However, for many consumers simple apathy or misguided loyalty has resulted in them staying with the same mortgage provider through thick and thin without giving any thought to just how much they could save by simply refinancing the mortgage, whether with the same lender or with another one.
Read more

Tags: Mortgages, Financial services, Real estate, loan, amount

Is a variable rate mortgage the right choice for me?

Consumers in the UK can enjoy a choice of mortgage options these days, and no matter what your needs and circumstances there is a good chance that there is a suitable mortgage product on the market for you. When it comes to mortgages consumers can enjoy options such as the standard variable rate, the fixed rate, base tracker mortgages, capped rate mortgages, and more. The most popular of these are the variable rate mortgage and the fixed rate mortgage, both of which offer benefits as well as disadvantages. Read more

Tags: Floating interest rate, Business Finance, variable rate mortgages, Mortgages, interest, UK mortgage terminology, Real estate

Housing market ‘in worst slump since 1992′

The housing market in the UK has fallen to its worst economic slump since 1992 when it last came out of a financial recession, according to the Royal Institute of Chartered Surveyors (RICS).

With the balance dropping for the sixth month in succession, 54.7 per cent more chartered surveyors reported a fall rather than a rise in house prices, the highest number for 15 years.

Jeremy Leaf, a spokesman for the RICS, said: “A lack of demand and confidence in the housing market is clearly behind the recent price slowdown.”

He added that tightening mortgage lending criteria is a block to many who are keen to take the “housing market plunge” while sellers are struggling to market properties to consumers content to “watch the current economic theatre from the wings”.

According to surveyors, the only part of the UK where prices continue to rise is Scotland with the net balance of surveyors in that country reporting price rises edging up from three per cent to seven per cent.

Meanwhile, a man who did not make any mortgage repayments for 15 years has had his debt erased by judge in an appeal court.

Tags: demand, Surveying, Real estate, RICS, market, consumers, Mortgage loan, property

Reduction in approvals ‘less dramatic than expected’

There has been a less substantial tightening in the mortgage market than was previously thought, according to the Council of Mortgage Lenders (CML).

In the Bank of England’s report today, the number of approved mortgages was shown to be steady, despite predictions that there would be a significant tightening of the market.

While there has been a slowdown, it is not unusual for the time of year and also reflects a slowdown in funding, explained Sue Anderson, head of member and external relations at the CML.

“To that extent this is pretty good news. It shows that the level of lending is looking as if it is holding up to a greater degree than some of the pessimists have been expecting,” she said.

The Bank of England report showed that net consumer credit in October this year was up on September as well as the average for the preceding six months.

Meanwhile, net credit card lending was up by £0.2 billion, which fell short of the net increase for September.

Tags: lending, Offset mortgage, Real estate, bank, number, increase, significant tightening, reduction

Consumers unsure of rate change impact

The majority of Brits are unclear on the value of a one per cent mortgage rate difference, it has emerged.

Research by Nationwide Building Society has found that 75 per cent of people in the UK do not know how much real difference this would make to their mortgage, which could be up to £4,000 on a five year fixed rate mortgage deal.

Meanwhile, when told to compare two five year mortgage deals to compare, the largest proportion of respondents (28 per cent) said there would be a difference of £500 to £2,000 between a £120,000 mortgage with interest of 5.6 per cent and one with interest of 6.6 per cent.

In fact the difference would be £4,000, which was correctly identified by just 23 per cent of respondents.

“People’s lives are busier than ever in the run up to the festive season and, as a result, they may be less inclined to shop around for the best deal. The temptation may be to take a slightly higher rate as an easier, less hassle option,” said Matthew Carter, divisional director for mortgages at Nationwide Building Society.

Tags: best deal, building, mortgage, run, mortgage rate, research, divisional director for mortgages, Real estate

High-end mortgage industry sees growth

Despite only representing a small amount of mortgage business, demand for high-end products is growing, an industry expert has said.

According to Andrew Arnott, a spokesperson for Investec, larger-scale mortgage growth is hailing particularly from “areas of multi-currency mortgages”.
“Certainly more banks offer larger-size mortgages than in the past,” he said.

“A lot of the products on the market aren’t available if the loan size is over, say, half a million or a million pounds.

“It is more specialist players that deal with those sorts of mortgages, so it’s more difficult for borrowers to find products right for them.”

Recent research by Halifax Estate Agents revealed that the number of house sales for £1 million has tripled in the last five years, with 6,107 homes selling for over a million from June 2006 to June 2007.

Halifax has estimated that there are currently 88,000 houses in Britain worth in excess of £1 million.

Tags: Britain, loan size, research, house, business demand, Real estate

‘Risk element’ to interest only mortgages

Customers choosing to invest in an interest-only mortgage risk falling into negative equity if housing prices drop after they have secured the loan, a finance expert has warned.

Re – Financial Planning explained that clients taking out insurance-only mortgages, which allow them to just pay back the interest on the sum borrowed and repay the original capital debt upon the sale of a property, would lose less money each month through mortgage repayments but face extra risk.

Not only would they still have the original loan repayment hanging over their heads, but they could be left owing their mortgage provider money after the sale of their property if house prices had fallen instead of climbed, explained David Higgins, director of Re – Financial Plannign.

“Any client taking on an interest only mortgage is adding an extra dimension of risk over and above what they would normally have with a capital repayment mortgage,” he said.

“I think mortgage lenders are more lax than they’ve ever been. The high property prices have lulled them into a false sense of security. They know that even if the person doesn’t have the means to pay off the mortgage that they have adequate security.”

According to MoneyFacts.co.uk, the recent credit crunch is starting to effect the buy-to-let sector, as providers begin to tighten credit criteria, raise fees and a withdraw products from the market.

Tags: Real estate pricing, element, Interest-only loan, Real estate, extra dimension, mortgage repayments, money

UK ‘confident’ in property market

The attitudes of the UK public to the homeownership reveal a strong seated confidence in the property market, a new report from the Building Societies Association (BSA) has shown.

The research indicated that 88 per cent of all home purchases are made primarily for living improvements rather than for capital gains.

It was also revealed that as many as 71 per cent of homeowners accept that prices could begin to fall this year, but that less than two per cent would feel compelled to immediately sell up in the event that this happened.

Adrian Coles, director general of the BSA, said: “Growth in residential property prices has largely been due to a wide selection of factors including low interest rates, lack of suitable housing stock, a buoyant economy and the ingrained desire in the British psyche to own property.

“Some commentators have cautioned that the market may be over reliant on consumer’s expectations that prices will continue to rise. However our report puts paid to these fears. Consumers have a realistic view of the property market.”

Last month, a report from the BSA argued that building societies offer higher levels of customer satisfaction than other financial institutions.

Tags: stock, Real estate, ingrained desire, realistic view, Boy Scouts of America, building society, customer satisfaction, Outdoor recreation

Nationwide house price report shows slowdown

Nationwide house price report shows slowdown

Further evidence for a rapidly-cooling house price market comes today, with the release of the monthly report from lenders Nationwide.

Seasonally adjusted, house prices made a gain of 0.1 per cent for July – the slowest growth for over a year, and a negation of the gains from the last set of results in June.

The annual rate of inflation is also down, currently standing at 9.9 per cent: numbers had been in the double digits for the last three months.

Nationwide starkly stated that the “risk of monetary overkill” looms large over the housing market.

The lender also welcomed the government’s housing green paper, which proposes that more affordable homes be built; yet “as the recent flooding shows, the challenges ahead are substantial”, it adds.

Many analysts will be surprised by the results, with Reuters reporting that a 0.5 per cent gain and an annual reading of 10.6 per cent had been predicted.

Tags: housing market, government, growth, Real estate, slowdown

50% of income going on mortgage

Some Londoners are spending as much as 50 per cent of their take-home income on their mortgages.

New figures from Woolwich highlight the precarious situation that many homeowners find themselves in and things could get worse with the Bank of England widely expected to announce a 0.25 per cent interest rate rise today (July 5th).

The average first-time buyer in the UK is said to be forking out 32.4 per cent of their take-home income on mortgage payments as property prices boom and people become evermore desperate to get onto the housing ladder.

The figures are a concern for many industry figures and Andy Gray, head of mortgages at the Woolwich, said further rate rises are likely to have a massive impact on the housing market.

“We fully expect the average age of first-time buyers to go up until people are well into their 30s,” he revealed.

“For those lucky enough to be on the ladder, the data suggests that in certain areas of London they are already stretched. The last thing any of them need is a further increase in base rates.”

First-time buyers, many of whom are understandably desperate to get onto the property ladder, are advised to carefully calculate their finances before taking out a mortgage to ensure that they are financially prepared for any future rate rises or changes to their circumstances.

Tags: market, Real estate, United Kingdom, rise, mortgage, housing market, increase, andy gray

New buy-to-let trend

A new trend is developing in the buy-to-let market, with people buying homes and renting them out then using the money to pay their own rent.

Many first-time buyers are finding it so difficult to buy a property in the south, and in particular London, that they have to rent, says website SpareRoom.com.

However, they feel as though they are wasting money this way, so they buy a house in a cheaper area and rent it out.

The rent they receive from this property then goes towards paying their mortgage and their own rent but, in the mean time, they are buying a home.

“We’re seeing a definite increase in young first-time buyers taking on a bigger mortgage than they can afford on their own and renting out a second room to pay for it,” said Rupert Hunt, founder of SpareRoom.

“Not everyone wants the risks that come with joint ownership. Until recently it has been tricky for people to get a big enough mortgage to buy somewhere with a second room to rent out, but things are getting easier.”

In response to this growing trend, many mortgage providers are now offering loans which take into account income earned through renting another property.

Tags: Renting, Politics, Real estate, way, trend, Mortgage loan, young first-time buyers, Equity sharing

First-time buyers taking risks

First-time buyers are prepared to take bigger financial risks to get on the property ladder as house prices continue to rise.

As the third interest rate rise in five months looks set to have just a minor impact on the price of a house, Yorkshire Bank says many consumers feel forced into taking big chances with their future.

According to the bank, three out of five first-time buyers would consider taking out a home loan that was five times their income.

In addition, 80 per cent would also consider getting a mortgage which is paid back over more than 25 years in order to make the monthly payments more manageable.

“With the average house price nearing £200,000, this year may feel like the last chance saloon for first-time buyers already finding it hard to buy,” said Gary Lumby from the bank.

“Saddling themselves with such huge debts isn’t wise as they could still be paying off their mortgage well into their sixties or even seventies.

“They may also face breaking point should interest rates increase again. Unfortunately for some, they feel it is their only option,” he added.

Yorkshire Bank has also found that 28 per cent of first-time buyers are so keen to get onto the property ladder that they are willing to offer above the asking price straight away for a house which they want.

In response to the current housing climate, 15 per cent of parents have started a home fund to help their children buy a house when they are older.

Tags: council of mortgage lenders, chance, monthly payments, bank, property, yorkshire bank, business, Real estate