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Repossessions Hit New Lows

[ Posted June 27th, 2010 ]

Recent figures gathered throughout the country indicate and overall drop in the number of repossessions occurring in the first quarter of the year of 11% over the previous quarter, bringing the total number of repossessions having taken place to a total of roughly 10,500. This is coupled with a drop of roughly 2% over the previous quarter as well of the number of borrowers holding mortgages going into arrears on their payments, with a total of roughly 40,500 home owners throughout the UK joining the heavily indebted social niche.

These figures are quite optimistic and positive compared to predictions that were made earlier in the year of up to 53,000 homes expected to be repossessed this year, with actual reports now painting all earlier expected figures in a pessimistic light. The primary reason for this significant drop in actual repossessions and new borrowers falling into arrears is seen by most experts to be the result of the continued low mortgage rates and interest rates in general on loans offered by most institutions and continued to be supported by the central England banks.

Other factors that have contributed to the recent drop in mortgage arrears and repossessions lie in many lending institutions becoming more lenient in recent months in regards to many borrowers in order to allow more flexible repayment terms, especially for those that have had to rely upon bad credit mortgages in the past in order to secure their homes. This has worked to help lessen the overall financial strain on the general populous and increase the overall financial wellbeing of many areas while allowing others to also utilize lower-rate re-mortgages to pay off other debts that they may not have been able to eliminate otherwise.

Cost of Home Ownership Drops

[ Posted June 26th, 2010 ]

Recent polls and reports indicate that the price of owning a home has dropped by an average of over £500 in recent months, bringing to total yearly cost to just over £9,000. In terms of the cost of owning a home compared to the actual earnings most people make on a yearly basis this means a drop in overall cost from 30% of total yearly earnings in 2008 down to 27% on the nationwide average based upon figures collected by the UK’s biggest lender in the mortgage field, Halifax.

The primary reason for the drop in overall costs is attributed to the regular lowering of overall mortgage payments needing to be made in recent months thanks to the continuing low interest rates supported by the central banks. In fact, when comparing current mortgage figures to historical records, experts have noted an overall decline of roughly 19% over the two year period. This equated to an average overall mortgage rate drop of roughly 2.13% for existing borrowers, showing a decline from 5.8% down to 3.67%.

For prospective first-time buyers and existing homeowners looking at potential re-mortgages this is good news all around as the lowering rates mean substantially more flexible money being available for usage in financing and pursuing other investments. Oddly enough this is particularly true in London despite the fact that it has the highest overall average yearly home operation cost of roughly £12,000 per annum compared to the lowest cost of roughly £7,000 in Northern Ireland. Despite this the higher income offered by London workers means that even with the nation’s highest total housing cost individuals living and working within the city’s limits are only contributing an average of 24% of their annual wage to home operations costs compared to those in the East paying a total of roughly 31% of their annual earnings.

Small Lands with Big Profits

[ Posted June 25th, 2010 ]

Home prices have risen tremendously over the past few years, though none more so than residential undeveloped property in some sectors throughout the country. One perfect example of this is a quaint little plot of land sporting a mere cottage with a draw well and simple electricity, used to house a woodsman’s operation. Purchased in 1991 for a mere £30,000 the 2-acre plot of land outside of Blandford, Dorset has recently reportedly been getting offers upwards of £1 million.

Most experts attribute the recent high offers in no small part to the continued low mortgage rates being offered by lending institutions for purchases coupled with the expanding market in countryside homes. While this push has effectively cut off most first-time buyers from being able to afford purchasing homes in their own neighbourhoods at the same time it has meant potentially staggering offers for many local owners that may not have considered prices such as these possible just a few short years ago.

Even though many people are expecting the property market to slow down considerably in the near future many lending institutions are maintaining strong pushes to ensure that they are securing most buyers though more and more competitive insterest rates on loan offers, particularly in terms of fixed-rate mortgages that are being secured on properties with significantly low loan-to-value ratios (with loans requiring a less than 90% ratio having some of the best possible deals around).

Given this trend many buyers are looking to secure these purchases now before lenders revoke the offerings or the central bank decides to finally do away with the record low interest rate that has enabled these institutions to keep up these highly attractive offers. In buyers terms this means that more and more properties can be expected to be seen at relatively high values in the near future, though this may not be a long-term condition.

Upcoming Shift in Regulations Could Mean Trouble

[ Posted June 21st, 2010 ]

Many experts along side the British Property Foundation (BPF) have warned against a potentially dangerous move that could set back the real estate industry throughout the UK should the government move in its favor – the removal of debt relief from many banks offering affordable lending for many individuals that have suffered as of late due to the ongoing economic crisis. Word of this possible shift has caused great concern today with the vote on whether or not to follow through with the plan to cut the relief plan set to go to vote tomorrow (Tuesday) in parliament.

Should the bill pass many lenders anticipate that they would be forced to call in thousands of debt claims in order to maintain solvency, forcing many individuals out of house and home (and in many cases into even worse situations) should they need to follow through with drastic actions in order to stay afloat. This would mean a major blow in particular to those who are currently relying upon debt relief laws in order to maintain a decent (though still troublesome) bad-credit mortgage on their home to cover other debt despite the continued record low mortgage rates offered by many lending institutions throughout the country.

Residential property would not be the only affected, however – in fact, according to recent reports roughly £55 billion in commercial property debt is looking at coming up for refinancing this year in light of many businesses looking to refinance following the recent economic rebound that has occurred over the first half of the year. A change now in financing could potentially mean a major blow to many sectors that are just now beginning to recover, and many eyes are on the upcoming decision to see just how they may fair in the coming months and years financially should the debt relief be removed or even restructured away from its current regulations.

One third of new buyers are singles

[ Posted June 11th, 2010 ]

Recent reports show that roughly one third (37%) of all first-time buyers throughout the United Kingdom in recent months are singles looking to make their first purchase on their own. In contrast, roughly 29% of all individuals purchasing a home for the first time are doing so after getting married – a major shift from figures gathered a few decades prior in the 1970s where roughly 84% of all first-time buyers were couples and a mere 10% were single.

This recent trend can be attributed to a number of different factors, with the socioeconomic situation affecting most purchasers being the key area of concern for most. In that the cultural norm of society has shifted away from couples deciding to purchase a home together to almost encouraging individual purchases, in some ways encouraging those to have a solid "foundation" down before deciding to get married. This is a common trend in many countries, in fact, and even in as far away as China individuals are actually expected to already own a home or apartment before even considering marriage (something that is helping to contribute to the growing debt burden for many workers due to skyrocketing house prices without increasing salaries as well).

The ongoing good mortgage rates offered by lending institutions for many buyers has also helped contribute to this figure over the past few months, however at the same time rising house prices entering into the market once more are becoming a large concern for many individuals and are expected to turn around this trend in the near future – particularly for those who are requiring assistance from a re-mortgage offered by their parents to help them secure their initial loan. As of April of this year house prices stood roughly 0.2% higher on average over March, with a total price hike of roughly 8.5% throughout both England and Wales.

Overvaluation triggers fears of double dip

[ Posted June 8th, 2010 ]

Despite the fact that, in general, European real estate markets are showing all the signs of putting the recent economic downturn behind them, experts are continuing to warn of the still existing dangers of a double-dip recession.

The housing price slump has certainly slowed in a number of countries, including Italy, France, the Netherlands and Spain, although Ireland remains an exception to this rule, according to a recent  Housing Market report released by Standard & Poor’s.

According to Jean-Michel Six, Standard & Poor’s chief European economist, there are some definite signs of European housing price stability, commenting that there have been numerous signs of price stabilization throughout Europe as a whole. Still, many specific areas are still in danger of faltering – even if they have shown some positive trends as of late according to many experts, with some key countries that have experiences rebounds as of late still potentially in danger of facing a housing market recession once more if things do not remain optimal.

S&P’s report shows that France is leading the way in terms of overvaluation, currently standing 18.5% higher than its long-term average. Germany, by contrast, seems to be undervalued by around 12.5%, perhaps due to the fact that they were largely on the sidelines of the housing boom.

As far as the UK is concerned, the affordability ratio shows a substantial overvaluation that stands at 21%, and the ratings agency has warned that this could result in further price slippage in future, maybe even later this year.

The report further indicates that some areas, with France in particular, potentially facing dire straits in the coming months should things destabilize even somewhat. As an indicator of this mortgage approvals have begun to recede across the country following 2009 highs, a dangerous sign for many market watchers that some locations may not necessarily be as suitable as they may first appear on the surface.

Russian Investors Push Demand for Prime London Property

[ Posted June 7th, 2010 ]

The price of prime property in central London is being pushed upwards as a result of demand from Russian buyers, a new report indicates. During May, prices rose by 1.4%, which is the 14th monthly rise in a row. Prices are now 23% higher than at their lowest period last March, according to the Central London Residential Index from Knight Frank. Prices, however, remain 6.4% lower than the market peak seen in March 2008.

The report indicates price rises in Kensington, Chelsea, Knightsbridge and Notting Hill have been at the forefront of the market during the course of the last year. Now, however, Kensington, Mayfair and Knightsbridge are climbing sharply, and price growth has hit 14% in these regions during the past half year.

The recent index also indicates that the market is being led by foreign buyers, with the number of Russian buyers increasing markedly by 112% during the past two months.

Liam Bailey, head of residential research at Knight Frank says that the weak pound is stimulated investor interest in London.  Of particular note is that the British Pound is still roughly 34% lower in pure Dollar terms than it was in 2008 – a sign to many investors of the potential benefits of investing in the UK at the current time. Of particular interest are Russian investors, having reacted little to the impact of the General Election and maintained positive buying trends throughout the country in the past few months.

Mr Bailey believes that the current upheaval in global financial markets has definitely unsettled both buyers and sellers, with the proposed changes to CGT unsettling some sellers especially. He says that the market has also seen a sharp rise in the number of potential sellers looking to dip their toes into the property market. He also stated that evidence was mounting to suggest that residential sales volumes and prices in the wider UK market are coming under pressure.

UK sees highest annual property price growth since 2007

[ Posted June 6th, 2010 ]

Yearly residential property prices for Wales and England have stayed in positive territory for six consecutive months now, following April’s 8.5% rise, which marks the highest annual chance since September 2007, according to new market figures. The March to April monthly rise was 0.2%, which took the average property price to £165,596, according to the data from the Land Registry’s flagship House Price Index. The index is based upon actual property sales, and is widely seen as the most reliable of all published indices in the industry.

Every region in Wales and England saw a rise in average property prices during the course of the  last year, with London seeing the highest yearly price change with a rise of 14.8%. This rise represents London’s seven month of price growth in a row. The monthly change for London stands at 1.5% and brought the average price of London properties to £341,487 as compared to the general average for England and Wales which is £165,596.

The highest rate of yearly price growth for London was experienced in the borough of Kensington and Chelsea which saw a rise of 3.3%. The sharpest fall was seen in the borough of Newham, with a price drop of 0.8%. The sharpest monthly fall was seen in Redbridge, with prices dropping by 0.4%.

The lowest yearly price rise was experienced by Yorkshire and The Humber, with a change of 0.7%.

On a local picture, Brighton and Hove experienced the highest rate of yearly price growth at 16.8%, with Middlesborough seeing the largest fall, dropping by 9.5%. The figures are consistent with those seen in other recent indices from both Nationawide and Halifax.

Many industry analysts now anticipate that prices in the housing market are set to struggle for the remainder of this year.

UK Buyers Burned for Thousands by Shady Operators

[ Posted June 5th, 2010 ]

The many harrowing and upsetting tales of properties buyers and investors purchasing properties abroad and being undone by unscrupulous lawyers, agents, developers-and even banks-have kept coming out and serve to underscore the necessity for investors and buyers to avail themselves of proper, impartial and expert advice before they take the final step of parting with any hard-earned cash.

Many British investors have found themselves being left considerably financially bereft due to such issues, with some being left up to half a million pounds in the red, according to a company that was recently set up to aid those afflicted investors in regaining their deposits. The company,, which was set up just one month ago, has already been contacted by hundreds of property investors who have told how their dreams of foreign property ownership have left them in a parlous financial state.

Their tales are many and varied, and include estate agents that took their clients’ money and subsequently disappeared having failed to pass the money on to the developer. Also, the company has heard how developers have failed to obtain licenses, not delivered upon their initial promises or have just gone bust after taking the money. They have also heard about banks that have mishandled clients’ funds, change the terms of the loan, leaving the investor at the mercy of a dramatically altered landscape due to not taking due care and getting good initial advice.

Daren Wallbank, the director of, stated that such stories just underscore why the foreign property industry often has such a poor reputation. One buyer, looking to purchase an apartment on the Costa del Sol, lost 25,000 Euros when the agent, lawyer and developer all went bust. Another investor paid 42,500 Euros to purchase a Costa Calida townhouse. The townhouse itself was finished, but did not have a habitation license and, as a result, the buyer postponed taking the title deeds, although the poor quality of the building work has resulted in basement flooding. The agent has refused to access it until the final payment has been made. Mr Wallbank urged greater research among buyers, and stated that there were no quick fixes.

Real estate facing long-term sustainability standards issues

[ Posted June 3rd, 2010 ]

The recent commercial property agents report from the Royal Institution of Chartered Surveyors has shown that one-in-five global surveyors feel that 90% of all real estate stock will continue to fall below decent standards of sustainability by 2020 unless green incentives are re-thought and improved. The report makes even poorer reading at regional levels, with almost half of respondents in Latin America feeling that it will most likely take a decade or more for even one-in-ten of all commercial real estate stock to meet the kind of decent sustainability standards espoused by LEED and BREEAM.

Although there is a general view that more recently built stock is meeting higher standards than before, the survey does indicate the tough challenges facing governments in the face of the need to enacting exacting and idealistic real estate plans.

The Royal Institution of Chartered Surveyors is convinced that an immediate incentivising of the refurbishment of current stock should be put to the forefront for the decade to come.

It appears that developing markets overseas face the biggest challenges, and agents in the Middle East and Africa are equally pessimistic with regard to meeting even fairly modest targets over the coming decade. Agents in Asia and the emerging sector of Europe, however, were more upbeat, and their thinking was more aligned to the point of view espoused by developed economies.

The report also showed that the majority of occupier types were beginning to begin greater sustainability measures in line with their real estate needs, and the greatest such growth was seen in the office sector-particularly in Europe. The industrial and retail sectors came next in line, respectively.

It appears that sustainability solutions are most readily implemented by professional firms, and such companies were a little way ahead of the media industry and government occupies during the opening quarter of this year. According to agents, firms employing fewer than 50 people will face greater challenges with regards to implementing sustainable real estate solutions and indeed this category showed the only declines in solution implementation for the first quarter of 2010. aims to provide every client with cheap, affordable and best mortgage loans in the UK market, however the actual mortgage rate available will depend on client's financial circumstances and credit history. Although, has made every effort to ensure that the mortgage rates listed are correct, it bears no responsibility in case of an error. 
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