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Em Morley

Home insurance premiums drop by 6.6%

Published On: August 10, 2015 at 3:32 pm

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Categories: Finance News

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Encouraging news for property owners looking to switch home insurance provider came in new research conducted by Consumer Intelligence.

Falls

The market research provider indicated that the cheapest home insurance premiums dropped by 6.6% between June 2014 and 2015. However, 35% of this fall was recorded in just two months-between April and June of this year, when the average of the lowest five premiums dropped by 2.3%.[1]

In total, the average of the five cheapest home insurance policies in June 2015 was £115, a reduction of £13 from one year previously. Consumer Intelligence believe that with such a sharp fall in average insurance premiums, those looking to change provider could enjoy substantial savings.[1]

Home insurance premiums drop by 6.6%

Home insurance premiums drop by 6.6%

Switches

Consumer Intelligence’s Switching2 Index shows that from in excess of 11,000 home and motor policyholders, 35% of home insurance customers changed provider in the year to May. Half of those did so in order to benefit from lower premiums.[1]

Between June 2014 and 2015, the average of the cheapest five home insurance quotes for people aged over 50 dropped by 6.8%. As a result, this age group pays around £106 for their home insurance. For people under 50, the figures are 6.3% and £125 respectively.

Ian Hughes, Chief Executive of Consumer Intelligence noted, ‘this fall in premiums can be explained by a big reduction in burglaries and far fewer claims for flood and storm damage. In 1995, just under 9% of homes suffered from a burglary, compared to a little under 3% last year. Those switching home insurers this year could see significant savings.’[1]

[1] http://www.propertyreporter.co.uk/finance/home-insurance-premiums-see-a-66-dr0p-in-12-months.html

 

 

Lenders Use Social Media to Track Applicant Behaviour

Published On: August 10, 2015 at 2:04 pm

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Categories: Landlord News

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Lenders Use Social Media to Track Applicant Behaviour

Lenders Use Social Media to Track Applicant Behaviour

Mortgage lenders are using social media to find out what applicants are doing and what their friends say.

A warning arrives from Property Tribes, stating that UK lenders use websites as part of their due diligence.

Property Tribes’ Vanessa Warwick believes that lenders particularly use Facebook.

She says that they look out for people who discuss no money down deals and how to structure illegitimate deals. She claims that lenders use whatever means are available.

In the USA, this practice goes even further, with lenders examining the credit ratings of members of an applicant’s social network.

Agents and landlords should consider who they connect with on Facebook and be aware that this can affect them.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage Trust updates BTL products

Published On: August 10, 2015 at 1:03 pm

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Mortgage Trust has today become the latest firm to update its buy-to-let product range, by keeping some of its most popular fixed-rate deals, while introducing a number of fresh initiatives.

Deals

Within its new rates, Mortgage Trust is offering three-year deals at 75% LTV, giving customers the choice between an initial rate of 3.25% with a 2% fee, or 3.65% with a £999 fee.[1]

In addition, Mortgage Trust has a number of fixed-rate products with two, three and year deals, with a significant range of fee and rate options. What’s more, all products include free valuation but are subject to a £150 application fee.

John Heron, Director of Mortgage Trust, commented, ‘we have extended the availability of some of our most popular fixed rate products and added further options for landlords with a medium term planning horizon. Fixed rate products provide landlords with an opportunity to fix a key element of their cost base and maintain a stable rent environment for their tenants.’[1]

‘We expect many landlords will be reviewing their finance options closely as a base rate rise moves closer,’ Heron added.[1]

[1] http://www.propertyreporter.co.uk/finance/btl-products-upd4ted-at-mortgage-trust.html

 

Less people moved home in Q1 of 2015

Published On: August 10, 2015 at 12:30 pm

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Fewer people moved house in the first half of 2015 than in the same period last year, suggests a new survey by Lloyds Bank.

The banks’ latest Homemovers Review shows that 155,000 people moved property during the first six months of the year, which was 9% down on the opening period of 2014.[1]

Decline

Despite the year-on-year decline, the number of homemovers in the opening six months of 2015 was 32% more than in the same timeframe in 2009. However, the total was way down than in the first six months of 2007, where there were 327,600 movers.[1]

As the total number of homemovers fell between the opening halves of 2014 and 2015, first-time buyers also fell by 10% during the same period. The number of first-time buyers has however risen significantly more sharply than the number of homemovers during recent history.[1]

Andrew Mason, Mortgages Director at Lloyds Bank, commented, ‘there was a modest decline in the number of homemovers in the first half of the year compared with 2014, which was in line with the general softening in housing market activity. Whilst the number of homemovers has risen significantly since 2009, it remains well below previous levels and has recovered less strongly than first-time buyer numbers. This is likely to partly reflect the high costs associated with moving home, as well as highlighting the difficulties that homeowners can face in finding somewhere suitable to move to due to the shortage of properties available for sale.’[1]

Prices

Data from the report also shows that the typical price paid by a homemover has risen by 25.2% over the last five years, from £208,654 to £261,524, an increase of £52,869. In addition, the average deposit put down by someone moving house in 2015 was £87,954-8% greater than last year. This equates to 34% of the typical price paid in total by homemovers.[1]

By regional, the data shows that unsurprisingly, movers in the capital put down the largest deposit of £175,273, which amounts to 36% of the average property value in the region of £492,882.[1]

Less people moved home in Q1 of 2015

Less people moved home in Q1 of 2015

Stamp Duty joy

Alterations to Stamp Duty charges have also saved the average homemover £4,769, which has reduced the tax bill for someone buying the average priced property of £261,524 from £7,845 to £3,076.[1]

Nationally, the number of people moving home paying Stamp Duty is around 83%, in comparison to 76% in 2005. This number varies by region, with 100% of movers in London paying the tax, in comparison with 66%.[1]

Types of Property

Homemover purchases are relatively evenly spread between the three main property types-semi-detached (30%), detached (27%) and terraced homes (25%). However, first-time buyers prefer to buy flats, with 23% in comparison to 10% of overall homemover purchases of the same property type. [1]

In London, a far higher number of movers favour purchasing flats (32%). Additionally, homemovers in the capital bought a lot smaller proportion of detached homes than the national average, with 8% in comparison to 27%.[1]

[1] http://www.propertyreporter.co.uk/property/h1-2015-sees-a-decline-of-homemovers.html

 

 

Scotland and South West show big rent rises

Published On: August 10, 2015 at 10:55 am

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Rent values in the South West and in Scotland continued to rise sharply in the three months to July, according to a new report.

The HomeLet Rental Index indicates that rent prices rose in many regions of the UK during the period, with many areas either keeping pace with or exceeding the rate rises seen in the capital.

Increases

Data from the Index shows that average rents agreed for new tenancies in the second quarter of 2015 in the UK was £977 per month. What’s more, the typical rent price was found to be 11.8% at the same time in 2014.[1]

In addition, figures from the report show that all regions, with the exception of the North West, registered a rise in rent values over the period.

Values in the South West of England for rents agreed in the first three-months of 2015 were 11.4% greater year-on-year. Scotland recorded an annual rise of 11.2% while the South East saw prices 10.3% higher in the three-months to July than at the same time in 2014.[1]

In the capital, average rents for new tenancy agreements are more than twice as much than in the rest of the country, in cash terms. For new agreements in the three months to July, rents were 9.5% more than a year ago.[1]

Broad-based

Martin Totty, Chief Executive Officer of Barbon Insurance Group, the parent company of HomeLet, commented, ‘the July HomeLet Rental Index demonstrates just how broad-based the rise in rent prices has now become-this is a UK wide trend.’ He noted that, ‘regions which have long been associated with a buoyant rentals sector, such as London, continue to experience rising prices, but rents are also rising in many other parts of the country at similar rates.[1]

Scotland and South West show big rent rises

Scotland and South West show big rent rises

‘The South-West of England, for example, is benefiting from its popularity with those attracted to the area for lifestyle reasons, as well as the strong local economy in many of the towns and cities of the region, Totty continued.’[1]

Mr Totty went on to say that, ‘over the past few years, price trends in the rental market and house purchase market have been very similar. However, across the first half of this year, house price growth has slowed whilst rental values have continued to increase, perhaps reflecting a change in the relative attractiveness of renting versus buying over this recent period.’[1]

He also feels that, ‘with early signs of the cost of mortgage finance starting to edge up, it will be interesting to see if this recent trend continues or if the change in buy-to-let mortgage interest tax relief announced in the Summer Budget has any indirect impact on rental values with some suggesting it could further stimulate rental values over time if supply of rental properties is constrained as a consequence.’[1]

[1] http://www.propertyreporter.co.uk/landlords/south-west-and-scotland-lead-the-way-for-rent-rises.html

 

 

Affordable Homes Moved Out of Battersea Development

Published On: August 10, 2015 at 10:23 am

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Categories: Property News

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Affordable homes reserved for first time buyers and tenants at the Battersea Power Station development have been moved to a new plot half a mile away from the luxury property scheme.

Over 370 affordable homes were originally planned to be mixed among the multi-million pound apartments next to the Grade II Listed power station, but are now being built on a former industrial estate between busy railway lines.

Developers argue that this is necessary, to make way for a new giant sewer.

Wandsworth Council is currently considering a plan to move the cheaper homes to a collection of mansion blocks, which will be ready in 2019.

However, as the homes are being located as far away from the site as possible, the proposals signal that developers plan to segregate the luxury homes from the affordable ones.

Head of the Battersea Power Station Development Company, Rob Tincknell, defends the change, stating that the affordable homes will be completed sooner under the new proposal.

The affordable homes will be built on a three-acre site in Sleaford Street, on the other side of Battersea Park Road.

This is the opposite of the original plan, which was to mix affordable homes with the luxury properties throughout the later phases of the scheme.

Tincknell says that when they were aware of the Thames Tideway Tunnel – the new sewer – and the Northern line extension, the plan was reconsidered, so that work wasn’t delayed.

He states: “When it became apparent that construction of the Thames Tideway Tunnel would delay delivery of affordable housing, we were immediately asked by our shareholders to develop an alternative strategy to deliver our committed affordable housing.”

The affordable homes are designed by Patel Taylor Architects, which created homes at the Athletes’ Village in Stratford for the 2012 Olympic Games.

Tincknell continues: “We think the architecture is beautifully proportioned and the 374 homes are spacious and well laid out, with the vast majority benefitting from double or even triple aspect.”1

The properties will be housed in five mid-rise blocks, ranging from nine to 18 storeys. Over 250 homes will be rented out on long leases and at lower rates for those priced out of the local private rental sector.

The average rent of a two-bedroom flat in Nine Elms is currently around £3,000 per month, says Zoopla.

The remaining properties will be sold to local first time buyers that earn from £40,000 per year, who will be able to buy a 25% share. A two-bedroom flat in the area costs just over £1.2m.

The project includes a new piazza with space for market stalls, a ball court, outdoor gym equipment, children’s play areas, a fitness trail, a private residents’ garden and a community garden including allotments and fruit trees.

Additionally, there will be a new NHS health centre on site and small business units, as well as shops and cafes.

When it is completed in 2025, the development will include 581 affordable homes – the remainder will be built in later phases – accounting for 15.2% of all housing on the site.

The Mayor of London, Boris Johnson, defended affordable housing on the £8 billion site last year, noting that it will provide hundreds of homes for struggling Londoners.

1 http://www.homesandproperty.co.uk/property-news/news/its-battersea-poor-station-first-time-buyers-banished-former-industrial-estate-half-mile-luxury-homes