The number of buyers in the UK housing market has risen three months in a roll, as lower prices boost interest, according to figures from the Royal Institution of Chartered Surveyors (RICS). But it said first-time buyers were still largely frozen out of the market, as lenders demand high deposits. Existing homeowners are the main source of the increased interest, as well as investors.
Archive for the ‘Property Market’ Category
Buy enquiries still on the rise
Wednesday, February 18th, 2009Repossessions on the rise
Friday, August 8th, 2008The number of homes being repossessed leapt by 41% in the first half of the year to hit the highest level since the mid-1990s and by 48% compared to the same period in 2007. During the 1990s house price crash repossessions peaked at 38,900 in the second half of 1991, with a total of 75,500 homes seized that year. However, the Council of Mortgage Lenders has predicted repossessions to accelerate further that it’s current figure of 18,900 and hit 45,000 this year. The CML said it expected 170,000 mortgages to be in arrears of more than three months by the end of the year, however the numbers remained small in context of the 11.74 million mortgage borrowers in the UK.
2000 jobs axed at Persimmon
Saturday, July 12th, 2008
Builder Persimmon today axed 2000 jobs as it fights the worst slump in the housing market for 30 years. the firm has cut 1100 of its full-time workforce since the start of the year and plans to lay off 900 temporary staff. It followed 1000 job cuts at rival Barratt Developments and 900 at Taylor Wimpey - with hundreds more expected at the likes of Bovis Homes and Redrow before the bloodletting is over.
Persimmon also said house sales fell 31% in the first half of the year with the average selling price down from £189,255 to £181,500, leaving revenues 34% down on last year. Shares in the housebuilding sector have crashed by around 90% since early last year as the housing boom ground to a halt.
Lloyds TSB and Northern Rock in mortgage deal
Sunday, June 15th, 2008
Lloyds TSB has struck a three-year deal to take on Northern Rock customers who are coming to the end of fixed rate mortgage deals. Certain mortgage customers will be offered the opportunity to switch to a Lloyds from July. The deal will assist Northern Rock in reducing the size of its balance sheet. Lloyds has set a maximum loan to value ratio of about 80% for the mortgages it will take on, but it said this will be flexible. The tax payers obviously have the rough end of the deal here - as Northern Rock which is now state owned will be left with the riskiest borrowers, just as housing repossessions are expected to rise. Northern Rock itself warned last month that arrears were rising and shifting customers could become more difficult as the economy worsens and rivals cut back on lending.
£300bn wiped off value of British homes
Thursday, June 12th, 2008Britons have collectively seen nearly £300 billion wiped off the value of their homes since house prices first began to fall in September last year, research by property valuation website Zoopla.co.uk has showed. This is equivalent to more than £1 billion a day being wiped off the collective value of British homes. But it added that the recent price falls should be seen in the context of strong gains in recent years, with the value of Britain’s housing stock soaring by £750 billion during the past three years and £1.7 trillion during the past five years.
Repossessions to soar by a quarter
Monday, April 28th, 2008Home repossessions will soar by almost a quarter this year as the credit crunch bites, a leading economic consultant has warned. Around 33,400 people could lose their homes during 2008 - 23% ahead of last year - the Centre for Economics and Business Research (CEBR) said. Mortgage deals are also set to remain expensive until the pressure in money markets eases, according to the group’s latest consumer and housing prospects report. The warning comes despite the Bank of England’s £50bn bid to tackle the crisis last week by allowing banks to swap their riskier assets for safer ones in an attempt to kick-start credit markets. Until the mortgage finance starts to flow again, the outcome will be a reduction in house prices and an increase in repossessions.
How to avoid the negative equity trap
Wednesday, April 23rd, 2008Here are a list of what you can do:
- If your mortgage is interest-only, switch to repayment asap. It will be more expensive in the short term but will save you thousands in interest in the long run.
- Pay extra on your mortgage every month. This will reduce the debt and cut the interest that you are charged each month. But check how much you are allowed to repay penalty free.
- If you want to repay more than the bank will allow penalty free then put the extra cash into a cash Isa first for tax free savings. This can then be used to bolster your equity when you want to move home or remortgage.
- Don’t be tempted to borrow from other sources such as credit cards to repay your mortgage.
For more information, visit thisismoney.com
Mortgage approval slumps as banks run out of cash
Wednesday, April 23rd, 2008In a year, mortgages for people buying a home have dived by 46% as Britain’s banks run out of money to lend. Figures from the British Bankers Association (BBA) showed mortgage approvals for house purchase in March tumbling to its lowest figure since records began in 1997. This shows the extent to which banks are tightening their belts as they find themselves unable to secure funding for mortgages. Borrowers needing to remortgage or purchase a home are finding lenders have raised rates to reflect their own higher borrowing costs and increase margins on mortgages. Many are also demanding higher deposits to protect against house price falls and to raise the quality of their loan books. The rising cost of securing funding on the money markets has seen the inter bank lending rate Libor rise to 0.9% above the bank rate of 5% - the historical average is 0.13%. This has substantially pushed up the cost of new tracker rate mortgages, which are heavily influenced by Libor. The BBA said it expected lending to continue to weaken due to the continuing decline in mortgage approvals.
London’s negative equity locations
Sunday, April 20th, 2008The London postcodes at greatest risk from the housing crisis was revealed today by the Evening Standard. Tens of thousands of home owners across the capital will be plunged into negative equity this year if property prices fall by 20%. People who have taken on huge mortgages compared with the value of their property will owe more than the building is worth. The worst hit would be buy-to-let investors who tried to cash in on the housing boom, according to analysis obtained by the Evening Standard. Below are the top 10 streets and London boroughs most likely to be affected. Find out more at thisismoney.co.uk.
Top 10 London streets most at risk:
Calderwood Street SE18
Erebus Drive SE28
Queenstown Road SW8
Woolwich Common SE18
St Saviours Estate SE1
Glashier Street SE8
Greenhaven Drive SE28
St John’s Estate N1
Great Dover Street SE1
Borough High Street SE1
Risk level by London boroughs:
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