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UK Property News - ArchiveCurrent Property NewsBrown promises three million more affordable housesInterest rates held at 5.75 per centImportant Checks Before You Sign Up For a LoanGetting a Loan when you have a bad history 'more difficult' say Lenders
Find Loans for HomeownersFind Buy To Let MortgagesUK Property News - ArchiveCaution - this is archived material - see Current Property News for more recent information. 'More Houses needed' says studyOctober 26th 2007 - The National Housing and Planning Advice Unit has released a report saying that the government should be planning to build 270,000 homes a year by 2016 instead of its current target of 240,000 a year. Average house prices in England are more than seven times average salaries now and the NHPAU warns that this could increase to 11-13 times average salaries in some areas if the extra properties aren't built.In a separate announcement housing Minister Yvette Cooper said councils are to receive £1,100 per new home built, which may increase to £5,000 within the next four years. Funding was also to be made available to try and bring Britains pool of empty properties back into use. Current estimates say that there are almost a million empty properties in the UK and local councils are to be incentivised with a £510 million fund to bring these back into occupation, including through compulsory purchase orders. Our comment - Don't expect to see a significant drop in UK house prices anytime soon. Supply still lags way behind demand and with the UK's population forecast to hit 71 million by 2031, we need to build many more houses. Interest rate still at 5.75%October 6th - The Bank of England left base interest rates on hold at 5.75 per cent for the third consecutive month. Analysts now predict that the rate is likely to drop to 5.5% by the end of 2007 as the bank attempts to balance the inflationary effect of a rate drop against the possibility of an economic downturn in the new year. Mortgage Lending UpSeptember 25th- Latest figures from The British Bankers' Association reveal that mortgage lending rose by £6.1 billion in August. This is an increase to July's mortgage figures, and despite the fears that the recent US financial crisis may affect the UK economy. The increase in mortgage lending indicates that the housing market remains strong. The government have announced plans to guarantee bank and building society deposits up to £100,000 for existing savers to help restore confidence after the Northern Rock crisis. Savers are making the most of the increase in interest rates. Inflation Rate DownSeptember 25th - The UK inflation dropped below the government's 2% target during August to 1.8% . These figures make it less likely that there will be a further interest rate rise in the next few months. Interest rate stays at 5.75%September 6th - The Bank of England left base interest rates on hold at 5.75 per cent. However, analysts predict that high street banks may still raise their mortgage charges due to the recent US financial market crisis. Several banks have already raised savings rates to around 6.7per cent. This is an intimation that the lending rate is likely to go up. Around two million UK home owners are already facing higher interest rates in the next few months, when their fixed rate mortgage period ends. It's Back to School for Banks!September 6th - A lesson seems to have been learnt by the banks after the US invested in the sub-prime mortgage market and got their fingers burnt. The financial money-market traders are now facing liability for their lending and it is beginning to cause a freeze in investment. Business lending is likely to be more difficult to obtain and at a more expensive rate. Due to this money crisis banks are not lending to banks, and the European Central Bank (ECB) and the Federal Reserve have been adding funds to try and steady the volatile financial state. The Bank of England has now joined them with a promised £4.4 billion for the next three weeks. They have been criticized though, for dragging their feet with help for the UK market liquidity, and there are fears that the crisis is likely to impact on the UK economy. Consumer spending and the housing market has already showed signs of slowing. UK House Prices likely to be affected by US financial crisis August 28th - The UK housing market is showing signs of slowing down,
due to the recent rises in interest rates and now analysts are predicting
the recent drop in US house prices and rise in mortgage and loan defaults
will affect UK confidence in property investment. House Prices increased by 0.7 per cent in JulyAugust 2nd - House price inflation is showing signs of slowing. Sellers seem to have been affected by the recent interest rises and have flattened their asking prices, contributing to this low monthly rise. In June, prices increased by 0.8%. Only London house prices seem to keep escalating with an annual rate of increase of 21.7 per cent, compared to the rest of the country's annual rate of house price inflation of 10.3 per cent. A strong economy and employment market continues to reinforce housing demand. Remortgaging increase to lower monthly paymentsJuly 24th - After 5 successive interest rate rises since last August,
and with the impending threat of yet another interest rise later this
year - bringing the UK base rate to 6 per cent - analysts are predicting
more homeowners will decide to remortgage, in order to reduce their
higher monthly mortgage payments and house sales will drop as fewer
people choose, or can afford to move. Shared Ownership for more First-time buyersJuly 14th - The Shared Ownership Scheme - whereby a buyer purchases a percentage share of a property owned by a housing association, and then pays rent on the remaining share - is proving popular this year with First-time buyers, due mainly to the escalating interest rates. This is most prevalent in London, but the scheme now seems to be gaining ground throughout various parts of the UK. More 'Eco towns'Gordon Brown also wants more 'eco towns' - those with zero or low carbon housing. HIPS put off sellersAccording to latest research figures the government plans to introduce Home Information Packs (HIPs) has already affected property price growth this year. HIPs Packs were phased in from August 1st 2007 for all four bedroom houses being sold in England and Wales and from 10th september for 3 bedroom houses. The government introduced HIPs Packs will contain key information and documents about the property, including a newly introduced Energy Performance Certificate (EPC). The cost to sellers is expected to be around £300-£600. House Prices continue upwardsProperty prices climbed 1.1 per cent in June, bringing the annual rate to 11.1 per cent, according to the latest figures from a leading Building Society. During May mortgage approvals also increased, despite the interest rate hike. The house market remains strong, due to the continued shortage of properties and high demand. House prices have risen by at least five per cent in every region of the UK over the past year. London - runner-up as the most expensive cityJuly 2007 - London is the second most expensive city to live in the world. Properties in the top locations of the capital, such as Knightsbridge and Belgravia are now commanding prices of around £4,000 per square foot. Moscow comes first place. Offset mortgages gain in popularityJuly 2007 - The number of Offset mortgages has increased this year. Many consumers hope this choice will help reduce the impact of any future interest rate rises. An Offset mortgage combines the mortgage and savings into one account, so the credit balance works to offset the mortgage debt, helping reduce the overall interest charges. May UK Interest Rise to 5.5%May 10th 2007- Today brought another interest rate rise
from 5.25 per cent to 5.5 per cent by the Bank of England's Monetary
Policy Committee, in an effort to restrict inflation. Inflation has
risen above the government's 2% target. House Prices Rise continued in first quarter of 2007March 1st 2007 - Figures from a leading Building society reveal UK
property prices during February continued upward, despite three recent
interest-rate increases in the last five months. The annual house-prices
inflation rose from January's 9.3 per cent to 10.2 per cent. There has
been a monthly increase in house prices from 0.3 per cent in January,
to 0.7 per cent in February 2007. UK Mortgage approvals increaseMarch 1st - The Bank of England issued figures for February 2007, showing lenders had approved 120,000 loans for house purchase - this is a rise from 114,000 during December. This is higher than economists had predicted and reveals a continuing strength in property prices, despite the higher interest rate. The Bank of England's Monetary Policy Committee, who decide on the UK basic interest rate, may see these figures and the February property price rises as a reason to consider further interest-rate increases to control the economy, especially the inflation rate.Find Loans for HomeownersFind Buy To Let Mortgages Five times salary mortgages availableSeveral top Building Societies have recently increased the income multipliers they use when deciding whether to accept a mortgage application. One leading high street lender is even offering mortgages based on up to five times the applicant's salary. Fifty-year mortgagesDecember 2006 - First-time buyers, according to a recent survey, would prefer the option to extend their mortgage term to more than the average of twenty-five years to fifty years, in order to keep their monthly payments down and to enable them to get onto the property ladder.
House Prices 2007 Predictions January 2007 - Property analysts are predicting that during 2007 house
prices are likely to rise by around four per cent. However, some economists
believe that property prices could increase by as much as 8 per cent
this year. House prices rise 1.4 per cent in Nov 2006 November 2006 has produced the biggest increase in house prices for
nearly two years, despite the recent quarter-point interest rate rise,
a report from a leading building society reveals. The annual rate of
increase has risen to 10.5 per cent. This rise is equivalent to a property
price increase of £45 a day over the last year. There is still
a large shortage of property in the south-east, which helps maintain
the
high house prices. Economists predict that the housing
market will remain strong with likely further rises in prices. The
Bank of England's recent report shows mortgage lending hitting a three-year
high. The interest rate rise has not had an immediate impact on the
housing market. There has been an increase in the take-up of longer
fixed-rate mortgages. Hot Property Prices rose 4.9% in the UK November 2006 - House prices have risen 4.9 per cent during September and October 2006. UK mortgage approvals - seen as a good indicator of future demand in the property market - reached their highest level for more than two years. The rise in interest rates during August, which brought rates up to 4.75 per cent, does not seem to have put a brake on the housing market. Since the UK property boom began in February 1996, house prices have risen by an average of 187 per cent, according to Britain's largest mortgage lender. First-time buyers August 2006 - Many first-time buyers are finding it impossible to get onto the property ladder due to the continuing high house price rises. A recent survey from a leading UK Building Society reveals that around 17.3m people are unable to afford to buy their own home. This is mainly due to the high house prices, areas being unaffordable and being unable to raise the sizeable deposit required. In 2006, there has been a 25% increase in people taking out 100% mortgages, compared with figures for the first nine months of 2005. First time buyers need bigger deposit August 24th 2006 - To raise the £29,200 needed for up front buying costs such as a deposit and stamp duty on a typical home. A couple buying a house for the first time will now have to save up the equivalent of almost three quarters of their joint take home pay, compared to just over a quarter in 1996 a survey by the the Royal Institution of Chartered Surveyors announced this week. Meanwhile data released by the Council of Mortgage Lenders shows that the average first-time buyer income multiplier was 3.21 times their income in June 2006 - the highest figure on record. This was up from 3.20 times the average income in May, and 3.06 times in the same month in 2005. Despite this rise however, the number of first-time buyers taking out new loans increased by 14% to 39,500 in June 2006. August 2006 - Base rate rises to 4.75% The Bank of England increased the UK base interest rate to 4.75% on
August 3rd 2006. The rate had remained at 4.5% for a year following
a drop of 0.25% in August 2005 and was seen as a response to low growth
rates and an effort to curb inflation. To house owners this means that if you have a £150,000 mortgage
that tracks the base rate the rise will add around £21.50 to your
monthly interest payments. Analysts predict further rise House prices predictions Many people are still paying their lenders' standard variable rate, and with these recent changes it makes sense to consider changing mortgages. It is important to ensure before you make the move that you are not going to be charged fees for an early redemption.
17th July 2006 - The National Housing Federation which represents 1400 independent, not-for-profit housing associations in England has released research by Oxford Economic Forecasting (OEF) on how the housing market will look over the next five years. OEF’s projections predict the national average house price rising from just under £195,000 in quarter one of 2006 to almost £300,000 in 2011 making home ownership even more problematic for first time buyers and those on a lower income. Average house prices have risen by 139% since Labour came to power in 1997. Earnings have risen by 24% London property prices continue to rise in 2006
Capital property rose by an average of 6.7% during 2005. This was a welcome recovery, after the capital's property prices suffered the first annual fall in nine years in October. Building societies report increased housing market activity and improved buyer interest in London in 2006, with demand continuing to outstrip supply. First-time buyers are increasingly forced to look outside London in order to afford their first home. The recent increase of the Stamp Duty threshold in the budget will have little effect in the capital, as only 1.8% of properties coming on to the market in London are priced below the exemption figure of £125,000. Caution this is archived material - see Current Property News for more recent information. Stamp duty threshold at £125,000 since March 2006
In his budget of March 2006 Gordon Brown again raised the exemption
level for Stamp Duty, after having doubled the starting threshold for
residential stamp duty from £60,000 to £120,000 during 2005. Up to £125,000 - nil Stamp duty £125,001 - £250,000 - 1 per cent £250,001 - £500,000 - 3 per cent £500,000+ - 4 per cent Caution this is archived material - see Current Property News for more recent information. More Archived Property News5% average house price rise January 2006 kick-started the 2006 property market with a 1.4% rise in house prices. However, the Spring house sales seem to have slowed down, apart from in London, due probably to rising energy bills and higher unemployment figures causing uncertainty with prospective purchasers. A leading Building Society reports house prices rose in the UK in 2005
by 5%, with Northern Ireland and Scotland improving the most. The average
price of a house in Belfast in 2005 is £157,131 and Scotland's
hotspot, Aberdeen, now has an average property price of £141,510.
Caution this is archived material - see Current Property News for more recent information. UK annual house price rise Data from the Office of the Deputy Prime Minister reveals UK annual
house price inflation rose at an annual rate of 2.5 per cent in November
2005, exceeding analysts' forecasts. The annual rate of price increase continued to rise in Northern Ireland, north-west and north-east England. House prices in the east of England remained the same, and property prices in the East Midlands and south-west fell by 0.2 per cent. Homes in Wales suffered the worst fall in the annual house price inflation from 8.8% to 6.5%. House prices predicted to rise slowly and steadily in 2006 First-time buyers take the plunge into property in 2006 First-time buyers once accounted for between 45 - 55% of the total UK mortgage market, but this recently dropped to less than 30%. However, in the traditionally quiet house purchase time before Christmas demand from first-time buyers significantly increased. This has raised the average price for flats and terraced houses in January 2006, especially in in London and the south-east.First-time buyers are an important factor for the health of the housing market and the economy. Recent figures from a leading Building society reveal that a quarter of married couples living in rented accomodation long to get on to the housing ladder, but cannot afford to buy their first property. Many single renters are opting to remain living with their parents into their 20's, in order to save for their first home.Only one in five single people manage to get out of rented property. Affordability for first time buyers is worst in London and best in Scotland. Up to 5 years wait for first-time home buyers First-time buyers are taking on average nearly five years to save for a deposit on their first property purchase. 9 out of 10 homes are too expensive for the average income of first-time buyers, with rising house prices leaving many stranded in rented accomodation. House prices have continued to exceed both savings rates and incomes over the last year. This has resulted in first-time buyers having to begin saving earlier and harder to get into the housing market. Caution this is archived material - see Current Property News for more recent information. The average cost of a house in Britain is more than £100,000 in every single county in the UK The most expensive 12 counties in Britain were all in S.England, with
the average property values being more than £200,000. The fastest rise in property prices in 2004 was in the Scottish Highlands,
and West Glamorgan and Gwynedd regions of Wales. The north and north-west remains lower priced generally, with Merthyr
Tydfill, Wales having the cheapest properties averaging £64,865. Caution this is archived material - see Current Property News for more recent information. More £1 million houses Recent research reveals a rise of more than 35 per cent in the number of homes sold in 2004 for more than £1 million. House shortages There still remains a huge shortage of houses in S.England and a national
shortage in the supply of new housing which could keep pushing property
prices up. Affordability Despite the recent rises, interest rates are still historically low.
This along with high employment, consumer confidence in the strong UK
economy, and affordability supports the expected continued housing market
growth in 2006. Caution this is archived material - see Current Property News for more recent information. Long term investment Many people are realising that property is still a more secure home
for their money than conventional savings products. Property continues
to win over other investments, such as the stock market. Shared equity scheme During 2005 the government revealed more details of their scheme to
help first-time buyers to climb onto the property ladder. The new five-year
plan aims to help up to 100,000 first-time buyers by building affordable
houses on surplus NHS sites, and then selling the properties at a subsidised
rate. Prospective buyers are becoming encouraged by the relatively low cost of borrowing, and confidence is growing that the property market is beginning to stabilise after a 'soft landing' rather than the once feared property price crash. The strong UK economy and the lowest unemployment figures for three decades make home ownership a main priority to most people. Gordon Brown's March Budget Caution this is archived material - see Current Property News for more recent information. Strong and strengthening UK economy This spring budget was primarily aimed at boosting growth and improving
the competitiveness of the UK. Inflation on track Gordon Brown's 10th budget stated that inflation was expected to remain
around the target of 2 per cent over the next 10 years. Caution this is archived material - see Current Property News for more recent information. Housing changes The chancellor revealed plans for 100,000 new homes, and to enable
35,000 people to become homeowners he promised £970m for shared
equity schemes. The shared equity plans includes a pilot project with
minimum holdings of 25%. Caution this is archived material - see Current Property News for more recent information.
John Prescott announced that as part of the government's five-year housing plan, from April 2006 housing association tenants will be able buy a share - a transferable ‘equity stake’ - in their home, ranging up to 50% or purchase it outright. Tenants will be eligible for a discount up to maximum of £8,000. When the new equity owners move house, the housing association landlords would have the first option on buying back the share in the property, sharing in the profits and protecting the supply of social housing. The scheme is aimed at helping new buyers and lower income families to get a foot on the property ladder by building up equity. Online Land Registry service reveals UK house prices Since February 2005, for just a £2 fee online you can discover : who owns a specific property, how much it cost them, the name of their mortgage provider and the length of any lease on it. Prospective house purchasers can now quickly gain information on property
prices in their chosen area, and will also be able to view a property's
boundaries and any restrictions within the deeds. The service will hopefully
help prevent buyers paying over the odds. Caution this is archived material - see Current Property News for more recent information.
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