Conveyancing UK

The markets react

2010-05-07T15:36:00.001+01:00

The Markets have had a roller coaster trip today in reaction to a Hung Parliament. Gordon Brown's announcement that he had asked the civil service "to provide support on request" to parties in talks over forming a Government triggered a fresh sterling sell-off amid worries over political paralysis. The statement sent the pound below 1.45 dollars and 1.14 euro, but it recovered some ground minutes later as Liberal Democrat leader Nick Clegg said the party with the most votes and seats - the Conservatives - should have the first right to seek to govern. Fears over delays in tackling the UK's yawning deficit have punished sterling in a turbulent day as markets fear a Lib-Lab coalition in a hung Parliament. At one stage the pound fell more than 2% against the dollar to its lowest level since April 2009, while strong recent gains against the euro to above 1.18 were undone at a stroke as the pound slipped as low as 1.136.

Currency traders warned the political uncertainty sparked by an indecisive election result was likely to mean more volatility for sterling in the days ahead.

London's FTSE 100 Index also came under early pressure - it shed 100 points to hit a three-month low as trading began - although it recouped some losses later.

The pound's weakness and official figures showing factory gate prices rising at the fastest rate for 18 months also prompted concern over the return of inflation - leading to possible interest rate hikes from the Bank of England and jeopardising a fragile recovery.

The Bank's Monetary Policy Committee (MPC) is meeting today to make its latest policy decision, which will be announced on Monday.

The committee's inflation benchmark, the Consumer Prices Index, is well above the 2% target at 3.4% although it is currently forecasted to fall back below the target later this year.

It will be with intense interest that the world watches to see what will happen next. Undoubtedly, a strong united government is the best way for any country to move forward as it rears its head from a deep dark recession.

The results are in!

2010-05-07T14:22:00.001+01:00

As many commentators have pointed out, the election result is about as bad as it could be from a market sentiment point of view – strong government of any colour being vastly more to international investors’ tastes than the uncertainty and vacillation of a hung parliament.

So what’s going to happen? Well, Cameron is sure to have a go at forming a government of some kind, whether in coalition or as a majority. He has already said as much, vowing to govern as best he can ‘in the national interest’. He is thus set to be the next PM one way or another.

But his only chance of majority rule – and of getting to occupy Downing Street for anything like the full five-year term – is to forge an alliance with the LibDems. A pretty tall order – a poll this morning by Conservative Home estimates that 94% of Tory grass roots supporters want nothing to do with Clegg. In his favour, Cameron can probably count on Clegg’s support – despite having said the opposite only a few days ago. Nick’s only way to salvage anything from the dismal LibDem performance is to hook up with Cameron in return for a promised referendum on electoral reform. But he won’t find it easy to persuade his party to swallow such a deal either.

The alternative is a minority Tory caretaker government and another election, probably next year. Hardly a glorious prospect, given the urgency of action required to tackle our debts and get economic growth back on the menu.

Hung Parliament

2010-05-07T13:30:00.001+01:00

We have a hung parliament and it is not an ideal situation by any means.

More than any other time Britain needs a strong united government.

David Cameron is to set out plans to form a "stable" government, after the Tories won most votes but not an overall majority.

With results still coming in, the Tories have 294 seats in a hung parliament. He will say he plans to govern "in the national interest".

Nick Clegg, leader of the third biggest party the Lib Dems, said the Tories had the first right to seek to govern.

But Labour leader Gordon Brown is also hoping for a deal with the Lib Dems.

Under the rules of Britain's constitution, the sitting prime minister in a hung parliament has the right to make the first attempt at forming a ruling coalition.

As counting continues the Tories have gained 93 seats, Labour have lost 87 and the Lib Dems five, despite hopes of a breakthrough for the third party.

We will watch and wait with interest to see what the next few days will bring, both for the Country and for the housing market.

House Price Rise in April

2010-05-07T10:51:00.000+01:00

House prices rose by 1 per cent in April, according to Nationwide, taking the annual rise to 10.7 per cent — the first time it has reached double digits since June 2007. The average cost of a home in the UK is now £167,802, compared with £184,070 in June 2007. However, the pace has slowed in the past three months and the building society expects sellers to start outnumbering buyers, pushing down prices, as the year goes on.

Martin Gahbauer, Nationwide’s chief economist, said: “While the recovery in new buyer inquiries at estate agent offices appears to have petered out, the past few months have seen an increase in the level of new instructions from sellers. This should lead to a gradual flattening out of the recent upward price momentum.”

The Land Registry reported a 0.6 per cent fall in the average house price from February to March. The Land Registry figures, which are a lagging indicator of prices based on completed transactions, show that the average house price in March stood at £164,288. However, the figure could show a rise in April. A 38 per cent rise in the average number of monthly sales in the three months to January, compared with the same period last year, showed improved sentiment among homeowners.

Mortgage approvals in March also improved, the Bank of England said, increasing to 48,901, up from 46,882 in February. The figure is 17 per cent higher than in March last year, but the Bank’s figures still suggest that mortgage lending has had a sluggish start to the year. Approvals in the first three months were the lowest on record for the first quarter of any year, apart from 2009.

Lenders are also still demanding average deposits of 25 per cent from borrowers, while banks have warned that mortgage rationing may worsen next year when some of them are forced to repay the emergency government loans they accepted in 2008.

House prices may have regained some of their value, but the surveyors who valued them may still be in for a fall. Legal actions against estate agents and surveyors reached record levels last year, with 25 High Court cases alleging professional negligence over property valuations, according to Reynolds Porter Chamberlain, the law firm, compared with only one case in the previous five years. This comes after banks began to threaten surveyors with legal action for overvaluing properties before repossessing them and then selling them for a lower sum.

Recovery glitch?

2010-05-05T15:39:00.001+01:00

Nationwide’s April index shows that house prices have risen by 10.5 per cent since last year. This finding suggests that the election has not, despite some forecasts, filled the thoughts of the nation to the exclusion of all else. It is possible to discuss the respective TQs (telegenic quotients) of Brown, Cameron and Clegg while checking online the performance of property values in your neighbourhood.

Although the figures are a confirmation of the continuing recovery, the upward trajectory could be slowed by the larger number of properties coming up for sale and the deteriorating job prospects of many potential buyers. The uncertain outlook for employment is, indeed, one factor supporting the market.

Martin Gahbauer, Nationwide’s chief economist, notes that landlords, who may have been thinking of leaving the business, are now earning such good rental income that they have no reason to sell. Their tenants include many workers too nervous about the future even to contemplate house purchase.

Shed culture Some call it a shed. Others prefer the term summer cabin. But whatever name you give to this structure, the increase in its sales appears to be one unexpected side-effect of the mortgage drought. B&Q, which is reporting strong demand for any garden edifice, considers that the trend is caused by the larger number of young adults compelled to return to the parental home because they cannot climb on the housing ladder.

First-time buyers remain the group most likely to be refused a mortgage, mostly because they do not have large enough deposits. The shed/summer cabin provides them with a personal retreat where they can contemplate the woes of their generation. Or perhaps mums and dads go there when overcome with irritation at the invasion of their grown-up offspring.

As the banks are determined to shun first-time buyers whose parents can provide only shelter, not finance, shed culture seems set to flourish. The status-symbol purchase could be the £11,995 summer cabin, pictured above — more a home from home than a lawnmower storage facility. This sum, by the way, is equivalent to the 20 per cent deposit needed to buy a share in a one-bedroom flat in a Leeds affordable housing scheme.

Tesco homes might help

2010-05-05T15:37:00.001+01:00

Home is traditionally linked to food. But the move of a supermarket into housebuilding has provoked a mostly distasteful reaction. You could almost hear the nationwide “er, yeuch!” at the news that Tesco will be creating four mini-villages in London and the South East, each grouped around one of its stores, but also including parks and schools. Even those who rely on the store for most of what they eat — at home or at their office desks — are deploring the “Tesco-fication” of Britain that this diversification appears to threaten.

Some of these concerns are justified; the ubiquity of Tesco outlets has added to the oppressive uniformity of city centres and out-of-town malls. But Spen Hill, Tesco’s development arm, is doubtless aware that its residential products will not sell unless they meet the highest customer expectations on convenience, quality, price and looks.

The elegant recycling of existing buildings must be part of the offer, as must clever, contextual architecture. Maybe the process could even throw up some ideas to improve the identical Tesco Express shopfronts?

Sneering at Tesco homes may sound smart, but the supermarket will at least nibble away at the problem of the housing shortage. Lack of affordable and other homes is one issue on which political parties agree, though all will struggle to deliver an effective solution because the banks are disinclined to get involved. Lloyds and its peers are at present more preoccupied with extricating themselves from the consequences of their past ill-judged associations with developers. Yolande Barnes, residential research director at Savills, points out that Tesco is one of the few groups with pockets deep enough to finance new housing. The supermarket’s own bank could also be one of the few sources of funds for mortgage borrowers — it plans to sell home loans by Christmas. In Tesco, as in other supermarkets, we are spoilt and sometimes almost overwhelmed, by choice. But without Tesco, the shelves could look awfully bare for someone shopping for an affordable home next year, especially as government funding for this sector will be scarce, whoever is having his dinner at No 10 after May 6.

How to make your home pay its way

2010-05-05T15:06:00.001+01:00

When times are tough we all have to look to alternative ways of making money. What could be simpler than utilising your own home.

For years, we have stripped those floorboards, dipped our doors and painstakingly restored those thickly painted banisters and dado rails. As a nation of home improvers, we plough hard earned cash into our homes, either, for our very own ‘restoration project’ or simply just paying off our mortgage. So perhaps it’s time to make our homes pay us back. Listed below are a few ways in which we can maximize some payback from the very property that we have so lovingly nurtured.

1. Rent out empty space

Have all the chicks flown the nest? Are you looking at an empty room or two? If so why not rent out those empty rooms. The key is obviously finding the right person to let into your home. If you live in London or another big city, you could let to a commuter who needs a room only during the week. This is a growing market; You should charge 60% of what the rent for the whole week would be. Either way, provided the room is furnished, the first £4,250 per year you make is exempt from income tax under the government’s Rent a Room scheme.

2. Use the basement or attic

Many Georgian or Victorian terraces have a basement, and creating a flat in this area and renting it out can be a real money-spinner. If you don’t have one, why not dig one out?

You’ll need planning permission to dig a new basement, but request it as an extension, rather than as a separate flat, or you could end up paying two lots of council tax. If things get really tough, you can live in the trendy new basement and rent out the rest of the house. If they get really tight, sell the basement flat.

3. House swap cloudy Britain for sunny anywhere!

Don’t pay to go on holiday – do a house swap instead. You may be pleasantly surprised by what you get in return, especially if you live in a pretty village or tourist city, or near a coast or national park. Once you’re in that Greek villa or Italian apartment, you won’t be worrying about what’s going on back home. Leave detailed instructions on how everything works and what is and isn’t included. You will need to look into additional insurance if this is what you fancy doing.

4. The home office

About three million people in the UK work from home. If you set up shop at home, Revenue & Customs will let you set all sorts of at-home expenses against tax, such as part of your phone, heating and electricity bills. But watch out, If you claim that your home is an office, you may no longer be exempt from Capital Gains Tax.

5. Do you live next to Glastonbury?

If you live near a festival, concert or other event venue, you could make money by turning your home into a temporary B&B. And this doesn’t apply only to those who live in obvious places such as Wimbledon, Cheltenham or Edinburgh. With the ever growing amount of mini-festivals across the country, some-thing is bound to be happening near you. The Ryder Cup for example near Newport, some already claim that their homes are being rented out for £20,000 per week… Can’t be bad.

6. Money from using the great outdoors

Do you have a pool or tennis court that others would pay to use? Do you have a nice garden, with room for tables and chairs? Organise sports days. For a fee, tennis and swimming could be on the agenda. If you live in a pretty village or along a walkers’ route, and can bake, running a tea garden in summer can bring in profit for minimal outlay.

7. Use your power

With the average household energy bill climbing to £1,200 a year, your house should be working harder to save you money. Install enough solar panels, wind turbines and the like, and you can not only supply your own needs, but sell power back to the grid.

8. Rent out a parking space

If you have off-street parking or a garage that is unused during the day, rent it out – for between £50 and £300 a month, depending on location.

9. Roll film, camera action!!

Is your house interesting and photogenic? Film companies, advertising agencies and magazines are always looking for new locations. Handing over your home to a photographer or film crew can net you £500-£3,000 a day. Large and open-plan spaces in and around London are most in demand, but scouts look for properties all over the country, including terraced houses and cottages.

10. If it becomes desperate…

If you are fortunate enough to have a large garden, and can bear to lose a part of it, why not parcel it off for development. Sell of that piece at the bottom of the garden, sit back and relax. Of course its not as simple as it sounds, but it may be an option.

End to recession fears brings buyers back

2010-04-28T12:19:00.001+01:00

The UK’s top tier property markets experienced a buoyant month in April, with Prime prices increasing by 0.5% to £449,689 and Prime Platinum prices rising by 1.1% to £625,849. Annual growth of 3.2% and 6.0% was recorded for Prime and Prime Platinum respectively.

The slightly subdued start to the year has given way to a much busier period of activity, driven by a release of substantial pent-up demand. Consumer confidence climbed this month, amidst clearer signs that the economy is stabilising and a double-dip recession has been averted, resulting in a flurry of buyers returning to the market.

Now more optimistic of a lasting property market recovery, many buyers who had been putting off their move over the winter have taken the opportunity to purchase. This is particularly the case for families hoping to upsize to a larger home further out of town, fuelling competition for these types of property.

Supply-demand balance restored
The level of quality Prime stock increased by 4.4% in April, making it 41% higher than its level twelve months ago. However, supply is now being balanced by strong buyer demand, with all the typical characteristics of an active spring market being displayed.

Election could be tonic for the market
Astute buyers and investors see this as a good time to purchase Prime property in the right location and the General Election is unlikely to stall property transactions across this sector. Wealthy UK and overseas buyers will be largely unconstrained by the financial impact of any tax changes and the prospect of a new government may even help to strengthen the already improving consumer optimism.

All evidence points to a continued high volume of activity post-election, when the economic and financial outlook will be clearer, and we could be facing a busier than usual summer as home movers and investors prioritise property transactions while the timing is right.

Extract taken from Primelocation

The lastest mortgage figures make for interesting reading

2010-04-28T11:38:00.001+01:00

Some 34,905 mortgages were approved in April, up slightly on March’s 33,360, show the latest figures from the British Bankers Association.

It says the effects of the year-end change to Stamp Duty have now worked through, so although numbers appear subdued compared to the latter months of last year, house purchase approvals were some 20% higher than in March last year.

The average value of house purchase approvals was £146,100 - 11.8% higher than a year ago. Numbers of remortgaging and equity withdrawal approvals continue to be lower than a year earlier.

The 4.5% annual growth in the banks’ net mortgage lending substantially exceeds annual growth of just 1% across the whole market in February, as banks continue to provide the majority of all mortgage finance.

Gross mortgage lending of £8.7bn in March was less than the average of the previous six months - £9.2bn and 0.4% lower than in March last year.

Repayments were stronger than usual as banks actively encouraged borrowers to use surplus cash to reduce their borrowing where possible.

As a consequence, net mortgage lending grew by £2.4bn in March compared with £2.7bn in February, and was below the previous six month average

David Dooks, statistics director at the BBA, says: “Low interest rates continue to influence customer behaviour. Homeowners are reducing mortgage debt by making, or maintaining, higher repayments using the extra cash generated by lower mortgage rates. People are also holding more cash in their everyday accounts, rather than building up savings accounts and overall unsecured borrowing levels are standing still.

“Uncertainties in business trading are constraining company demand for finance, with large corporate sectors still seeing contractions in borrowing”.

The election and the housing market

2010-04-28T10:45:00.001+01:00

As usual, I have just read David Smiths article in the Sunday Times. The election is snapping at our heels, we are moments away from potentially having a new government in power, a hung parliament or indeed the ‘same olds’ remaining exactly where they are.

What will the election mean for housing? Inevitably, the big picture matters most: whether we get a hung parliament and what that means for the pound and mortgage rates. Housing policy also matters, but it has so far been the poor relation. The resounding housing pledges of past elections are missing from a campaign in which the only excitement has been Vince Cable’s proposed 1% mansion tax on £2m-plus houses, which will limit the Liberal Democrat surge in Mayfair.

Also missing, according to the industry, are answers to the biggest questions facing housing over the next few years. The Council of Mortgage Lenders (CML) has been through the three main party manifestos and found policies it likes, but its big worry is in an area none of the parties appears to have ideas about: how fill a £300 billion mortgage funding gap during the next parliament.

While the Tories talk about “less reliance on unstable wholesale funding” as a long-term ambition, the shorter-term problem will arise when lenders are weaned off emergency official support and have to roll over their borrowings in the markets. The danger, says the CML, is of a prolonged mortgage famine. Perhaps they will lower their lending criteria on mortgage approvals to pay back their borrowings and begin to take advantage of the inexpensive money that is now available to them on the money markets.

Housing supply, according to the Home Builders Federation, is another problem. The industry body says the shortfall amounts to almost 1m homes and is rising because of very low building levels. At current rates, it warns, every home in the country will have to last for 1,100 years before replacement.

If, as the Office for National Statistics suggests, Britain’s population will hit 70m in the next 20 years, we will require many more houses. Gordon Brown’s pledge, made in 2007, of 3m new homes by 2020 appears to have been quietly ditched and does not appear in Labour’s manifesto.

The Tories’ promised shake-up of planning, meanwhile, giving local people a greater say in permitting new developments, is seen by builders as a “nimbys’ charter”, hardened up by a manifesto pledge to allow referendums on local issues if 5% of people sign up. That could include blocking new developments. Even worse, some say, will be the Lib Dems’ proposal to slap Vat on new housing.

So the post-election housing landscape looks to be one with limited supplies of both mortgages and new houses. There is symmetry in that. It does not, however, make for a very healthy housing market.

Ideas for upgrading your bathroom

2010-04-27T13:12:00.001+01:00

My favourite room in the house is my bathroom. I am positively possessive in the extreme when it comes to this sanctuary of mine. The end of the day comes, and all I can think about is soaking in my supersize tub, aromatic aromas fill the air, dimmed lights and the soft flickering of calming candles.

Of course this has not always been the case, not so long ago; I was ever so slightly hunched up in a delightful ‘avocado’ coloured bath. The flooring was very interesting brown shag pile, complete with faded stained patches, green and yellow wallpaper completed this retro scene.

A bathroom, can with a little planning turn into that much needed haven, a place to escape from all the hustle and bustle of modern day living. Not only will you enjoy this restoration project but will add value to your property at the same time.

Here are eight tips for upgrading and updating this vital space.

1. If you have a coloured suite, it really is time for it to go.
White is the preferred choice for most homebuyers - it's clean, light and space-enhancing. And with the right colour accents, accessories and bathroom products, it doesn't have to be boring.
2. Planning the layout of your bathroom is a must.
If the layout works for you now, don't change it. Re-plumbing a bathroom is the most expensive thing you can do.
That said, if the layout doesn't work for you, and then work with a plumber to look at how it can be redesigned. If you are thinking about moving the bathroom into another room, then consider where the waste pipes would need to go and how much of the garden would need to be dug up if you had to relocate the soil pipe and drains.

Anything is possible at a price, but think carefully about how the work will interrupt your lifestyle and whether or not the payoff will be worth it. It's possible your dream bathroom can be achieved without a major overhaul. Don't spend unnecessary money on the location - that way you'll have more to spend on the details.

3. Small spaces can be made to work with the right pieces of furniture.
Corner basins and even toilets are available, but consider who will be using the room and how often. Avoid replacing a bath with just a shower, even if you rarely take a bath yourself. A change like this has the potential to impact your sale price. The word 'bathroom' has a little clue in its name - keep the bath in there!
4. Your choice of bathtub is an important one.
It shouldn't be taken lightly if you plan to use this newfound space for relaxing. There are a number of great spa tubs available so you can get the benefit of a spa treatment in the comfort of your own home. If you've ever had a Jacuzzi bath, you'll always want one.
Try to avoid corner baths where possible. They can be good for small awkward spaces, but they can also affect the resale value of your home.

5. Install a power shower to add maximum value to the space.
Choose one with an adjustable head so you can change the pressure. A high blast can be great for relieving aching shoulders.
6.If space allows, 'his and hers' double vanity basins are fantastic, and a much sought after bathroom feature. Bowl basins which sit on a wooden stand are the hallmark of an inspirational bathroom.

7. Take time to consider your fittings.
Chrome is very popular in modern bathrooms, and good quality fixtures can set off even the most basic of bathroom suites. Your strategy might be to save money on the suite, but finish it with high quality fixtures. This approach works very well on low to mid-range budgets.
8. Be careful when choosing flooring and tiles.
If you can afford to tile the whole room you might want to consider installing a wet room. Taking this approach you'll end up with a very streamlined space, but remember - there won't be any 'dry' areas in there.

Downing Street drops in value

2010-04-23T16:14:00.001+01:00

Downing Street is valued at £4.5 million, a drop of 9.18 per cent since Mr Brown became Prime Minister in June 2007, costing the taxpayer more than £460,000.It is in sharp contrast to Tony Blair who saw the property’s price climb from £1.65 million when he took office in 1997 to more than £5 million when he handed the keys over to Mr Brown.

There is a change in leadership over the next few weeks, Gordon Brown is likely to drop quite a few rungs on the property ladder as house prices in his own constituency of Kirkcaldy are among the lowest in the country, averaging £120,910 compared to his current address in SW1 where average house prices are £920,361.

This is quite ironic, Downing St, in common with a great deal of other UK property - tripled in value from 1.65M to 5M in ten years.

Downing Street drops in value

2010-04-23T16:13:00.001+01:00

This is quite ironic, Downing St, in common with a great deal of other UK property - tripled in value from 1.65M to 5M in ten years.
Nothing was created - certainly not a tripling of wages to afford to pay mortgages on properties three times as expensive.

This was a bubble, manipulated by a deliberately weak regulatory climate which enabled soft mortgage deals and ultra low interest rates - from which countless billions were leveraged from the same assets.

What the forthcoming election will mean for the property market

2010-04-16T13:31:00.001+01:00

Last year saw a remarkable turnaround in the UK property market and although there will be further challenges in 2010, most notably the general election; a recovery is underway, according to a new report.

This year has got off to a very satisfactory start and sentiment in the property market has improved as mortgage finance, while still restricted, continues to cheapen.

The prime property market remains buoyant, with a deficit of available properties and currency weakness attracting a steady stream of overseas buyers. With prices showing some recovery, we hope to see more properties coming to market over the course of the year, especially family houses where there is still a significant shortage.

In the lettings sector a limited availability in stock reflects a return to historic levels, without significant upwards price pressure, the report shows. Corporate rentals are slowly returning, although they still remain well below the levels seen in 2007. The report predicts that the rental market should continue to firm up, with shorter void periods and limited upward price pressure.

The big unknown of 2010 is the general election, with a hung parliament now being tipped as a relatively likely possibility, which could herald a period of uncertainty in the property market. But the report concludes that it is easy to over estimate the impact this may have on the housing market and the economy generally.

Although general elections do not usually have much sway on the property market in the UK, this year’s election could have a greater impact, particularly on mainstream real estate, than past elections because of where we are in the housing cycle.

Because the property market is already in a state of low turnover and is only partially functioning due to the global financial crisis, it is perhaps more vulnerable to the slightest political changes, according to a residential research director at Savills.

‘We have a partially functioning market where recent price growth has been driven by cash and equity rich buyers chasing low stock levels. With continued constraints on mortgage lending, the market is heavily dependent on sentiment amongst a certain class of buyer, particularly against the background of continued economic uncertainty,’ he explained.

‘We expect to see these low transaction levels continue up to the election and through the immediate aftermath as political uncertainty makes buyers and sellers pause for thought. In itself this could cause volatility in price movements, with possibly more short term downward pressure on prices in the mainstream market than we have seen in the past twelve months,’ he added.

‘Without doubt, and probably regardless of which party wins, an outright majority would be the best outcome for the housing market in 2010, and possibly through to 2012, the year we have penciled in as the start of a more sustained housing market recovery.’

Extracts taken from Property Wire and BBC live

A slip in Rates for a few

2010-04-16T12:49:00.001+01:00

Mortgage rates continue to slide down for new borrowers - but mainly for those with big deposits or substantial equity in their home.

HSBC launched a competitively priced two-year fixed-rate mortgage deal at 2.99 per cent. The downside is that it is available only to borrowers with at least 30 per cent equity in their home. The loan has an arrangement fee of £999.
Leek United Building Society has a three-year fixed-rate deal at 3.9 per cent. There is a £495 fee and it is available to those with a 25 per cent deposit or equity.
Co-operative Bank has a 3.19 per cent fix for two years with a £999 fee. Borrowers must have at least 25 per cent equity.
Over a five-year term, Accord, part of Yorkshire Building Society, offers a 4.44 per cent fix through brokers. It has a £1,995 fee and is available up to 65 per cent loan to value.
For borrowers who are prepared to live with the risk of interest rates rising, First Direct has a lifetime tracker deal at 1.89 percentage points above the Bank of England base rate, currently 0.5 per cent. Trackers mirror any rise or fall in the base rate. First Direct's starting pay rate is 2.39 per cent, there is a £499 fee and borrowers must have at least 35 per cent equity.
ING Direct has a lifetime tracker with a starting pay rate of 2.69 per cent and a £945 fee. The minimum deposit or equity is 25 per cent.

Stamp duty break already shows results

2010-04-16T12:44:00.001+01:00

Estate agents and mortgage lenders are already reporting surges in demand from prospective first-time buyers after the Government's announcement of a two-year stamp duty holiday for them.

It means a tax saving of up to £2,500 for genuine first-time buyers on property worth up to £250,000.

Last year's stamp duty holiday on properties worth up to £175,000, which ended on December 31, stimulated the market, the latest move on stamp duty will have a similar effect.

HIPs to be Abolished confirm Conservatives

2010-04-16T12:32:00.000+01:00

The Conservatives announced in their 2010 Election manifesto on 13th April 2010 that they indeed plan on abolishing the Home Information Pack if they get into power. They would also make the lower limit on Stamp Duty £250,000.To quote the manifesto;

“Help first-time buyers get on the housing ladder, by increasing the stamp duty threshold to £250,000, so that nine out of ten first-time buyers will pay no stamp duty. This is a permanent tax cut, unlike Labour’s plans which are just for two years; and Abolish Labour’s expensive and unnecessary Home Information Packs which increase the cost and hassle of selling homes."

At these early stages the polls are key. The sooner they show a clear winner, the stronger sentiment will be and prices and mortgage offers will stay firm. Uncertainty will operate in the opposite direction with people sitting on the fence unwilling to make a decision.

Neighbourly disputes

2010-04-12T12:32:00.000+01:00

I had an early morning call from my friend Alex this morning, you know, so early you think something awful must have happened. After a very tearful greeting, she explained her upset state. She has decided to improve her already cramped home. Her neighbours are making every step forward incredibly difficult. Her neighbours have always been quite cordial….. Until she applied for planning permission. (she didn’t inform them prior to planning application). They have issued forty objections against her planning application. “What can I do to put this right?”

In my opinion (we have self built three times) it is always a good idea to approach the neighbours first and explain your plans, it makes life far easier if you’ve kept them personally informed. It is easy to take your eye off the neighbourly ball when you are involved with the day to day nitty gritty of the project. Annoy them and you may have a lengthy feud on your hands, keeping them sweet is key.

Architects, builders and planners all advise sounding out the neighbours prior to purchase. Most objections are raised through fear and uncertainty. Councils don’t necessarily base judgments based upon a neighbour’s objection, but they are susceptible so any help towards your case is good. There are also legal reasons to secure neighbourly co-operation that a conveyancing lawyer ought to bring to light prior to building.

1. Are there any covenants restricting development?
2. Any easements granting another party rights over the land, including access?
3. They should examine wayleave, which allows services to run on or beneath neighbouring land.
4. They should examine the Party Wall Act, which not only applies to joining walls but also excavations.

Taking care of these issues in advance, protects against legal action later or any ambiguity.
Be good to your neighbours, communicate your enthusiasm and the fact that you are investing in their area, you may find they’re actually more tolerant than they first appear.

I have imparted this advice to Alex, who is going to have a meeting with them and show them all her plans for the extension… she is on a charm offensive.

How will this election effect UK property?

2010-04-12T12:13:00.001+01:00

The date is set for May the 6th, now is the time to consider how this election will effect the property market in terms of activity and prices.

Markets are as much about sentiment as supply and demand. This election brings with it a fair amount of uncertainty, the bookies claim that the Conservatives are favourites to win; others claim that there will be a hung Parliament.

If there is a clear winner, perhaps a Conservative win, prices may creep upwards. If there is a Hung Parliament, or Labour remains in power, they will remain level or indeed may even drop.

It is still quite a difficult time for the property market; we are vulnerable to any changes, especially political. At present we are riding on the back of cash and equity rich buyers chasing very few properties. Undoubtedly an outright majority would be the most beneficial outcome for the housing market.

Mortgage lending is still sluggish, and the market is quite dependant on sentiment. These factors make for a period of uncertainty leading up to the election. Transactions may be low in the lead up to and during the aftermath of the election, while people catch their breath. This could cause a fluctuation in prices.

The housing market will only be truly stable and grow under a new governing body if there is to be a general economic recovery, clarity on interest rate movements, true extent of public spending cuts revealed, availability of mortgage finance, Incentives to expand in the private rental sector, new housebuilding, increase in property stock, stamp duty and other hindering factors.

Proposals for the housing market by the main political parties

2010-04-12T11:37:00.001+01:00

Labour

Up to 10,000 new council houses a year by 2014-15, and more affordable housing.
Councils will retain their rental receipts locally, enabling them to support housebuilding and maintain properties.
Two-year stamp duty holiday for first-time buyers on transactions up to £250,000; permanent new stamp duty top rate of 5 per cent on transactions over £1 million from April 2011.
Agreements with banks to lend £105 billion to homebuyers and businesses over the next year.
The standard interest rate on the Support for Mortgage Interest scheme will be maintained until December.
A crackdown on tenancy cheats who fraudulently sub-let social housing.
Guaranteed housing standards for social tenants; measures to strengthen consumer protections for private tenants.
New homes to be zero carbon by 2016.

Conservatives

Permanently increase the stamp duty threshold for first-time buyers to £250,000.
Abolish Hips.
Reward councils for building more homes by allowing them to keep more of the proceeds from council tax and business rates from new development.
Create local housing trusts to allow communities to build affordable homes.
Abolish the unelected tier of regional planning, allowing local communities to determine the right level of development.
Give councils stronger powers to prevent infill development in suburbs, and build more family homes.
Give council tenants an equity stake in their home to restore pride in their area and encourage social mobility.

Liberal Democrats

Bring 250,000 empty homes back into use by giving owners cheap loans to renovate them.
Energy improvement packages of up to £10,000 per home, paid for by the savings from lower energy bills; new homes
To be fully energy efficient.
Repossessions will be stopped in cases where the lender has not pursued options.
A new planning “use class” for second homes, allowing communities to control the number of homes given over to holidaymakers.

Extract taken fro the Times online

Thank godness for the two-year stamp-duty holiday for first-time buyers

2010-03-30T11:03:00.001+01:00

My sister Tasha has moved in with us, tales of her disastrous money management are legendary. Being a much older sister, with two spare rooms, what could I do? So on a snowy Saturday, in she moved, complete with every IKEA accessory known to man! She is a complete disaster to have so close, bags of designer wares are wafted under my nose, my makeup is used and carelessly left strewn over every surface in what can only be described as Armageddon in the family bathroom.

So please imagine my delight upon hearing Alistair Darling announce a two-year stamp-duty holiday for first-time buyers on properties priced up to £250,000. Not having to pay the 1% levy, which used to apply to sales over £125,000, will mean a saving of as much as £2,500. Not a huge sum compared to the other costs of moving, admittedly, but helpful nonetheless: probably enough to buy a few choice pieces from IKEA, a comfortable, bed, sofa and maybe enough for Tasha to buy her own makeup! I passed her the phone to call the bank of mum and dad, deposits are their thing.

The number of first-time buyers has slumped in recent years. In 1999 alone, more than 590,000 people took their first step onto the property ladder; by the peak of the market in 2007, the figure had fallen to 357,000; last year, it was just 198,000. The Council of Mortgage Lenders (CML) estimates that the average person is now 30 before they buy their first home .Tasha is in her twenties, that is way too long for her to be our house guest.
Even modest changes to the tax rate, such as the one announced by Darling, will certainly have an effect — as shown when the government temporarily raised the point at which stamp duty kicks in from £125,000 to £175,000, from September 2008 to the end of last year. The CML found that the number of transactions in the £125,000-£175,000 range last December was an unseasonable. 63% higher than in the previous month but fell back by 80% in January, when the original bands were restored.

The effect this time around may not be so obvious, not least because the “holiday” will be enjoyed only by first-time buyers. This is not only a matter of excluding ‘wannabe’ buy-to-let landlords: if you have already owned a property, not just in Britain but anywhere in the world, you won’t qualify. Combining resources with someone else who has bought in the past is also not permitted.

Even more of a problem is the need to raise a deposit, which could be easily, be £50,000 for a £250,000 home. Although there are signs that lenders are beginning to look more favourably on those unable to lay their hands on that amount of cash, deals open to buyers with less than a 20% deposit are rare — and the fees and interest rates charged are, in most cases, consider¬ably less attractive than those on offer to existing homeowners trading up.

It may be that this stamp duty bonus could be the factor that lands Tasha on the property ladder; all she needs to do is find the right property. We have been looking solidly for the past few days; I can’t say that there is an abundant choice out there. Anything that looks somewhat appealing is snapped up within days of coming on to the market, everything else looks uninhabitable and in need of a lot of work. It could be that we have a temporary surge into the housing market from this but with limited properties coming on to the market, this could be a mini blip that drives prices up rather than wiping any savings on tax.

The Budget - a Key Point Breakdown

2010-03-24T15:57:00.001Z

Stamp Duty and Property

• The stamp duty limit for first-time buyers will be doubled from midnight tonight to £250,000 for this year and next, to be funded through an increase in Stamp Duty to 5% for houses worth over £1m from April 2011.

• The Support for Mortgage Interest scheme will continue at the higher rate for another six months.

• From October next year, the most expensive properties will be excluded from the Housing Benefit calculation in each area, which will - added to anti-fraud measures - save £250m a year.

Economy and Public Debt

• The Chancellor forecast the economy to grow by between 1% and 1.5% this year and between 3% and 3.5% in 2011. This is a reduction. His forecast for the following years is unchanged.

• Borrowing this year should be £11bn lower than forecast at £168bn. In 2010/11, borrowing will be £163bn, falling to £131bn in 2011/12, then £110bn in 2012/13.

• As a share of the economy, borrowing is forecast at 11.8% of GDP this year, 11.1% next year, then 8.5%. In 2012/13 it will be 6.8%, then 5.2%, falling to 4% in 2014/15.

• Public sector net debt will reach 54% of GDP this year. It will then increase to 75% by the end of the forecast period in 2014-15. Net debt, as a share of GDP, will begin to fall the year after that.

Banking

• The Treasury has already received over £8bn in fees and charges from banks and the one-off 50% tax on bankers' bonuses has already raised £2bn.

• Need for international systemic tax on banks, which he will urge on international finance ministers in Washington next month.

• A new guarantee will mean everyone can have a basic bank account, giving up to 1m more people access to bank accounts over the next five years.

• Agreement that RBS and Lloyds will provide a total of £94bn of new business loans.

Pensioners

• Tax credit support for older workers is to be extended. To make it easier for those over 60 to receive working tax credit, the Government will reduce the minimum hours they need to work to be eligible.

• The pensioners' higher Winter Fuel Payment of £250, and £400 for the over-80s, will be guaranteed for another year.

Families

• Parents of one and two-year-old children will be helped by increasing by £4 a week money paid through Child Tax Credit from 2012.

Unemployment

• A guarantee of a job or training for every 18-24 year-old after six months out of work is to be extended until March 2012.

ISA

• From next month, the annual ISA limit will rise from £7,200 to £10,200 and ISA limits will increase annually in line with inflation.

Fuel Tax

• Next month's increase in fuel duties will be staged. Fuel duty will rise by a penny in April, followed by a further 1p rise in October and the remainder in January.

• The Chancellor said by the time the full fuel duty rise comes in, in January, he forecasts inflation to be back below 2% and confirmed the Bank of England inflation target remains unchanged at 2%.

• The planned increase in fuel duty and landfill tax will continue for one year from 2014.

Personal Tax and VAT

• The Chancellor made no further announcements on VAT, income tax or National Insurance rates.

Alcohol and Tobacco

• Duty on beer, wine and spirits will increase as planned from midnight on Sunday. Alcohol duties will also increase by 2% above inflation for two further years from 2013.

• Duty on cider will increase by 10% above inflation from midnight on Sunday.

• Tobacco duty will increase from today by 1% above inflation and then increase by 2% in real terms each year until 2014.

Inheritance Tax

• Inheritance tax threshold will be frozen for a further four years to help pay for the cost of care for older people.

Business

• The cost of the £2.5bn overall one-off growth package will be met from existing budgets and by higher revenues from the bankers' bonus tax.

• A new Credit Adjudicator will fast-track complaints from smaller firms who say they have been unfairly denied credit.

• A new national investment corporation, to be called UK Finance for Growth, will streamline and improve Government help to small and medium-sized enterprises, overseeing £4bn of support for business.

• A new Growth Capital Fund will provide fast-growing companies with private capital and will eventually provide £500m of finance - with commercial banks so far agreeing to contribute more than £100m.

• Business rates will be cut for one year from October, meaning a tax reduction for over 500,000 small businesses in England. Small businesses will be helped to expand by doubling the annual investment allowance to £100,000. Entrepreneurs' relief for Capital Gains Tax will be doubled to £2m on which the lower rate of 10% will be taxed.

• The Chancellor will offer help to the computer games sector similar to the aid given the British film industry.

The Environment

• To boost a low-carbon economy, the Government will set up a new Green Investment Bank, controlling £2bn of equity. Half the cost will come from asset sales, with the rest matched by private investment. The fund will focus on green transport and energy, including offshore wind power, with £60m offered to develop ports hosting manufacturers of offshore wind turbines.

Extracts taken from Thisismoney.co.uk

Is size everthing?

2010-03-23T16:03:00.001Z

I have just read an interesting article in the Mail. It caught my interest especially as I have been moaning about how small my new home is….This week, it was revealed that a former London broom cupboard - now a 60.5sq ft micro-flat - in Knightsbridge has been valued at up to a staggering £200,000. That's for a property that's smaller than a full-size snooker table.

Daft? Perhaps. But it does have one major selling point: its local shop is swanky London department store Harrods. This places it in the heart of one of the capital's hottest locations, with Hyde Park on the doorstep and where even relatively ordinary flats regularly carry a multimillion- pound price tag.

But is it really worth investing in a property little bigger than the average prison cell, even if it does come with one of the country's most desirable postcodes?

Well, that depends on what you're after. While small studio flats in London's best areas can go for less than £200,000, they're little more than tiny pied-a-terres, and are unsuitable for anything more than a single, and very tidy, resident.

But they are a worthwhile option for those willing to sacrifice space for a posh address or people who work in the capital but have a main home out of town. Indeed, by buying a weekday bolt-hole, commuters can save a fortune on travel costs and time.

According to the Land Registry, the average property price in Kensington and Chelsea is a mind-boggling £821,496. It has a designer kitchen and bathroom, an entertainment system and a truly fabulous address. There's even a window.

The only catch? The living/kitchen area is 10ft by 8ft, with the bed on a mezzanine. Cluttons has a slightly more spacious studio on salubrious Sloane Avenue. On the market for £225,000, it is under offer.

Again, size is limited: it features a 16ft by 15ft living/ kitchen area with a separate bathroom. But for location, it's more or less unbeatable.

Studio flats are often very small, but upmarket areas benefit from a strong market, making any property within them a good investment. In some Central London areas, prices are almost back to where they were at the peak of the market.'

While national property prices have increased by 5.2 per cent in the past 12 months, Kensington and Chelsea has outperformed, rising by an extremely healthy 11.2 per cent. Marylebone, north of busy Oxford Street, has one of the capital's most idiosyncratic shopping streets and is another good bet.

Hips 'unsatisfactory'

2010-03-17T11:54:00.001Z

I have just picked up one of the many legal publications that arrive monthly onto my desk.

An interesting article caught my eye.

Almost a third of estate agents provide unsatisfactory home information packs according to a survey by Birmingham Trading Standards. Results of the study carried out at the end of last year revealed that, of the 37 packs examined, 70% were rated satisfactory or reasonably satisfactory, and 30% rated unsatisfactory when measured against the HIP regulations.

The most common faults included: no information provided on the complaint or redress procedure; no consumer information; no company contact details; technical issues with the search; and HIP index-related issues.

This comes as little surprise to me that a third of all HIPS were found to be below par. As they have no value to the buyer, they were always going to be done on the cheap.

In my opinion instead of upgrading them, surely the government should scrap them instead.The packs were supposed to hurry along the buying process, as they contain all of the property details, searches and an Energy Performance Certificate in one place. Unfortunately much of the documentation in the HIP is out of date on the day that it is produced and hence there is no cost saving as the purchaser needs to renew this documentation, leading to a duplication of costs.

The government has been accused by the Conservatives of stifling the property market with yet more red tape, creating a headache for those wishing to sell their homes, in an already tricky market.

A future with no keys?

2010-03-12T00:09:00.001Z

I have recently converted to an iphone and now I wouldn't be without mine; so an article in the Sunday Telegraph entitled 'Introducing the iKey: Apple's answer to the humble door key' grabbed my attention.

Apple are developing technology, nicknamed the "iKey", which will mean that rather than carrying around a bunch of keys, people will be able to use a single electronic device to unlock their car, front door and gain access to their office. You would simply have to enter a pin code and wave the device over an electronic pad fitted beside a door to open it. According to the article Apple have already filed the application with the US Patent Office and the application states: "The device can communicate with an external device to open a lock. By way of example, the electronic device may be a model of an iPhone".

Apple hope to replace cards and keyfobs by allowing the iPhone to be used instead to unlock doors to buildings and cars. In a home, householders would need to install electronic, computer controlled locks to their doors. The iPhone would need to be registered with the locks so that they could communicate with each other. By rotating the iPhone near the electronic lock, consumers then select their pin numbers on a dial displayed on the screen, as if entering a combination on a safe. If the combination entered matched the one held by the electronic lock, the door would open. If not, an alarm could be sounded or alerts sent to the householder to indicate someone was attempting to gain unauthorised entry. The patent also proposes encrypting any information that passes between the iPhone and the computer-controlled lock to prevent hackers from "listening in".

I thought that keyless systems for vehicles through key fobs would never catch on and I was wrong there - but no more keys? After reading the article on the iKey, it doesn't seem that it won't be long before conveyancers could be emailing pin codes out to clients on completion days rather than letting them know that their keys are ready for collection.