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Em Morley

Remortgaging Activity Surged in August

Published On: September 8, 2015 at 11:43 am

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Categories: Finance News

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Remortgaging activity outperformed all other sectors of the housing market in August, according to new research from Connells Survey & Valuation.

The number of valuations for remortgaging increased by 25% in August compared with July. As a result, the amount of remortgage valuations grew by 102% over the last 12 months.

Total valuation activity was slower in August. The number of valuations across all sectors, including remortgaging, rose by 7% monthly. Activity increased by 48% compared with August 2014, mostly driven by remortgaging.

Corporate Services Director of Connells Survey & Valuation, John Bagshaw, says: “Concern and media attention about an interest rate rise in the near future is the key driver of this surge.

Remortgaging Activity Surged in August

Remortgaging Activity Surged in August

“Due to the very low Bank of England base rate, there are currently some very appealing remortgaging deals on offer from lenders. But homeowners have been influenced by a powerful perception that these deals will not last.

“Underneath the short-term surge, remortgaging is also driven by a longer term shift. People are increasingly looking to upgrade their home rather than trade, and so, for a slightly different purpose, are also keen to take advantage of cheaper mortgage deals.

“Meanwhile, the wider picture looks encouragingly stable. First time buyers and homeowners are far more optimistic about the housing market now than they were at this point in 2014, and this is evident from the strong, steady growth we’ve been seeing throughout 2015.”

The amount of valuations for existing owner-occupiers looking to move house has increased by 3% since July. As a result, activity on behalf of home movers rose by 30% from August 2014.

First time buyer activity was similar. The number of valuations conducted in August for those looking to buy their first home rose by 1% monthly and 31% year-on-year.

Bagshaw continues: “Home mover and first time buyer activity has been sizeable and speedy growth over the last six months, so a period of more stable growth is a sign of consolidation.

“It shows that these sectors command long-term momentum and demonstrates a more stable optimism from households about the future.

“For those moving up the ladder, low mortgage rates are combining with property price growth as a basis for their next purchase. Meanwhile, first time buyers don’t have the benefit of this natural deposit, but are showing remarkable fortitude in the face of price rises – buoyed by a jobs market that is increasingly showing real wage growth.”

The only sector to see a fall in August activity was buy-to-let, in which valuations dropped by 5% on July. Despite this, the total number of valuations carried out for buy-to-let investors increased by 29% compared to last year.

He concludes: “Buy-to-let has retained its winning popularity with investors. The slight slowdown the sector experienced this month is likely due to some investors taking a step back to calculate the cost of the Chancellor scrapping certain tax exemptions for buy-to-let landlords in the summer Budget.

“However, the fundamentals of the rental market remain very strong, driven by tenant demand. Even buy-to-let – once a rollercoaster sector in terms of growth – is showing signs of settling into a positive pattern of strong and steady growth, a pattern replicated across many other sectors of the mortgage market.”1

1 http://www.propertyreporter.co.uk/property/remortgaging-activity-soars-in-august.html

UK homeowners spent £22bn on DIY tasks last year

Published On: September 8, 2015 at 11:41 am

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Homeowners in Britain spent a cumulative amount of £22bn on DIY projects during the past 12 months, according to a new investigation from Sainsbury’s Bank.

In addition, the data shows that 79% of property owners carried out at least one DIY task during the last year. These tasks ranged from repainting floorboards and putting up shelves to larger projects, such as converting an attic or room space. Those that carried out a task during the period spent an average of £1,085 each.

Improvements

Further data from the survey shows that 66% of adults plan to carry out some forms of DIY in the next year. The most popular area of a house to be earmarked for renovation in the coming 12 months was the garden, followed by a bedroom and the kitchen.

Research from Sainsbury’s bank showed the DIY projects earmarked in the next year by area of house are:

Room / area of house Percentage of adults planning to undertake some form of DIY here in the next 12 months
Back garden 26%
Bedroom 25%
Kitchen 22%
Bathroom 20%
Living room 20%
Drive / front garden 13%
Property exterior e.g. roof or windows 8%
Dining room 7%
Communal areas and stairs 5%
Study 3%
Basement or attic 3%
Other 2%

[1]

UK homeowners spent £22bn on DIY tasks last year

UK homeowners spent £22bn on DIY tasks last year

 

Simon Ranson, Head of Banking at Sainsbury’s Bank said, ‘whether you’re painting, wallpapering or tiling, the cost of DIY projects can soon add up; a credit card offering no interest on purchases is a good way to spread the cost, keeping within your monthly budget.’[2]

[1] https://www.landlordtoday.co.uk/breaking-news/2015/9/right-to-rent-seeing-lawful-tenants-refused-housing

 

 

Homes for Last Time Buyers Could Solve the Housing Crisis

Published On: September 8, 2015 at 10:41 am

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Categories: Landlord News

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Creating more homes for last time buyers could be the key to solving Britain’s housing crisis, says a Legal & General report.

There are currently 3.3m homeowners aged 55 or over who are looking to downsize, reveals research conducted by the firm.

Homes for Last Time Buyers Could Solve the Housing Crisis

Homes for Last Time Buyers Could Solve the Housing Crisis

The report, titled Last Time Buyers, suggests that if more purpose-built accommodation was available for older people, larger homes would be freed up for younger families to move into.

The report states: “These last time buyers are sitting on £820 billion of property wealth and 7.7m spare bedrooms. The equivalent to 2.6m family homes, this represents ten years of housing supply based on Government targets, or 20 years based on the current housing completions.

“Freeing up this housing stock will provide a powerful tool for addressing the housing crisis, reducing overcrowding, boosting the UK economy and bringing benefits across the property market.

“Given the size of the numbers involved, it is surprising how little attention has been paid to older buyers, even though this group is often open to the possibility of downsizing.

“By failing to target this key demographic with good value, purpose-built housing for those aged 55+, Government and industry alike may be missing an important trick.

“Not only will this type of housing give them a better quality of life, but it will also help to release additional funds for their retirement.”

The report continues that while around one third of older homeowners considered downsizing in the last five years, just 7% actually did. Many do not wish to downsize, with 58% saying that they will wait until they’re over 70-years-old.

The report also found that while 3.3m people over the age of 55 are looking to downsize, the amount of 20-34-year-olds still living with their parents has risen by a quarter in two decades, to over 3.3m.

According to the latest Census, there are 1m properties considered too small for the number of occupants, and housing charity Shelter has found that one in four children in London live in overcrowded homes.

The report concludes: “Encouraging last time buyers to move into purpose-built accommodation (without steep staircases, for example) could have a major impact on figures like these, yet there is simply not enough of this type of accommodation available.”1

1 http://www.propertyindustryeye.com/last-time-buyers-could-be-key-to-solving-housing-crisis-claim/

Lawful tenants being refused property

Published On: September 8, 2015 at 10:35 am

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Categories: Landlord News

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Confusion over the Government’s ‘Right to Rent’ scheme is leading to a number of lawful tenants being refused property in the UK, according to a new report.

Research from the Residential Landlords Association suggests that there are many landlords that are struggling with the complexity of the scheme, which has been piloted in the West Midlands.

Discrimination

The Joint Council for the Welfare of Immigrants (JCWI) suggest that stringent right to rent checks has lead to discrimination against tenants that appear ‘foreign.’[1]

42% of landlords are said to be less likely to consider someone who does not hold a British passport, with 27% of landlords hesitant to engage with tenants who have foreign names or accents.[1]

Following the pilot scheme in the West Midlands, the Government announced plans to roll out the scheme across the whole country. Landlords face up to five years imprisonment if they do not undertake the correct checks.

Confusion

RLA policy director David Smith said, ‘whilst the RLA opposes discrimination against tenants because of their race or nationality, the Government’s plans are causing confusion and anxiety for many landlords.’ Smith believes that, ‘if the Government expect landlords to act as border police it should provide the training and material needed to give them the confidence to carry out the checks required of them.’[1]

Lawful tenants being refused property

Lawful tenants being refused property

‘In the absence of such support, today’s research sadly shows the inevitable consequences of the policy which the RLA has long voiced concerns about. Faced with considerable sanctions, landlords will inevitably play it safe, where a tenant’s identity documents are either unclear or simply not known to them,’ Smith continued.[1]

Concluding, Mr Smith said that, it is concerning that the Government remains committed to rolling out the Right to Rent policy nationwide without first publishing its assessment of the impact it has had in its own pilot area. Ministers should halt plans to proceed with its rollout to allow time for proper scrutiny and consideration of the impact it is likely to have.’

[1] https://www.landlordtoday.co.uk/breaking-news/2015/9/right-to-rent-seeing-lawful-tenants-refused-housing

 

Prime Central London House Price Growth Lowest for Five Years

Published On: September 8, 2015 at 9:49 am

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There were 26% fewer homes sold for £1m or more in the prime central London market in the last 12 months.

The Land Registry data is supported by Knight Frank’s most recent prime central London sales index, which reveals that annual price growth, at 1.7%, was at its lowest level for over five years.

Without including the newest prime central London markets of Islington, Riverside, City & Fringe and Southbank, growth was at just 0.4% in the past year.

Prime Central London House Price Growth Lowest for Five Years

Prime Central London House Price Growth Lowest for Five Years

The Knight Frank report on prime central London sales in August states: “Demand was unsurprisingly restrained in August. It is typically one of the quieter months of the year, however, this seasonal trend was compounded by the fact that buyers have been coming to terms with higher Stamp Duty (for properties worth more than £1.1m) and uncertainty in global financial markets.”

The report also says that the market in August was particularly affected by China devaluing its currency, which has caused “some buyers to postpone decision-making until there is a greater sense of certainty.”

However, it adds: “On the other hand, there is evidence Chinese buyers have stepped up their interest in safe haven global property markets like London and are increasingly looking for homes in golden postcode neighbourhoods like Mayfair.”

The annual price growth of 1.7% is the lowest increase since November 2009, eight months after the market bounced back from its post-Lehman Brothers low.

But the report is optimistic: “The seasonal nature of the market dictates buyers will become more active in the autumn and a greater sense of normality will return to the market, which will also be driven by the fact vendors are lining up new properties for sale.”1

Tom Middleditch, an associate director at JLL Kensington, comments: “Pre-election weakness affected both the sales and lettings market, but this was reversed with the Conservative Party win.

“Although transactions were not quite at the euphoric levels that some agents reported in the immediate election aftermath, prime markets are now rebuilding stock levels and should find moderate activity growth in Q3.

“However, the lack of sales stock continued to push occupiers into rental property. This was particularly notable for corporates who, alongside strong demand from students, pushed up new lettings by 93% in June compared with 2014.”1 

1 http://www.propertyindustryeye.com/prime-central-london-price-growth-lowest-for-five-years/

OnTheMarket Confident it Will Overtake Zoopla

Published On: September 8, 2015 at 8:46 am

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OnTheMarket Confident it Will Overtake Zoopla

OnTheMarket Confident it Will Overtake Zoopla

OnTheMarket has achieved another record-breaking month, with traffic figures increasing further throughout August.

The property portal had over 5.4m visits in August, a rise of over 22,000 compared with the previous month.

It also attracted more than 2.5m unique visitors, a 100,000 increase compared to July.

These figures were measured using Google Analytics.

Ian Springett, Chief Executive of OnTheMarket, says: “In just seven months, we have dramatically changed the portal landscape, but this is still only the beginning.

“Our traffic, agent membership and property listings all continue to growth month-on-month.

“We remain confident that it’s only a matter of time before we overtake Zoopla as the number two portal in terms of property listings and then focus directly on providing agents and consumers alike with a credible alternative to Rightmove.”1

OnTheMarket will begin running its television advertising campaign this month. It will be screened over 2,500 times in three weeks.

1 http://www.propertyindustryeye.com/onthemarket-says-it-is-confidently-on-course-to-topple-zoopla/