All posts by sburns

End Of An Era

The time has come for me to take a break.

Following a long time deliberating, I have called an end to my time at the sharp end of estate agency, in order to concentrate on my consultancy full time.

I would like to take this opportunity to thank all those, who along the years who have helped me enjoy the best career for over a quarter of a century.

Although I won’t be adding to my blog, or active on social media, I’ll still be around and about, lurking somewhere, so please feel free to come and say hello if you catch me with my head in a property magazine.

 

House Prices Rise Over 5% In A Year

In the 12 months to October, UK house prices increased by 5.5%, the ONS has claimed, and rose 1.4% between September and October.

The year-on-year increase reflected growth of 5.7% in England, 2% in Wales, 3.3% in Scotland and 4.8% in Northern Ireland, said the ONS, with prices in London increasing 12%.

Excluding London and the south-east, UK house prices increased by 3.1% in the 12 months to October 2013.

According to the ONS, house prices in October stood at £257,000 in England, £164,000 in Wales, £129,000 in Northern Ireland and £184,000 in Scotland.

The average London house price was £437,000 while the north-east had the lowest average price at £148,000.

As usual, the ONS prices are a statistical leap away from the Land Registry prices for England and Wales.

The Land Registry says that the average house price in October was £165,515 – 0.2% less than the month before (compared with the ONS’s growth of 1.4%) and 3.1% ahead of October 2012.

Register Now For Help To Buy

Home buying, especially for first time buyers, has been a political hot potato since the housing boom went bust. Irresponsible mortgage lending, to people who could not keep up the repayments or found themselves in negative equity, was one of the main triggers for the economic crisis of 2008.

Since then, home ownership has been difficult to achieve; with less money to lend, lenders have been cautious about who they give it to. The result has been a stagnant housing market, which has only just been starting to show signs of recovery. For many would-be first time buyers, the impact of these broader structural problems has been a condemnation to a life of renting, whilst trying to save enough money for a deposit, commonly around 20 percent of the property price. Especially in expensive areas, such as the south-east, renting and trying to save has been an impossible task for many potential buyers.

The Government’s announcement in October 2013, that they had made plans to roll of out a new help to buy scheme, was met with enthusiasm. The details of the scheme were well-publicised; buyers need a five percent deposit. The Government underwrites the five percent. The scheme differs from the existing scheme, which has been available for a year, because it is available on all properties, so new build and resale ones, whereas the existing scheme was only available for new build properties. Under the existing scheme, the Government have provided a 15 percent deposit.

The mortgage is available on both new build and older properties. It is available to existing homeowners and also first time buyers. The scheme is available from January 2014, and is intended to run for three years. The scheme is available on properties up to the value of £600,000, although lenders can decide on which properties they will lend on. Although the scheme is not yet operational, the main lenders are already taking expressions of interest. It is expected that, once the scheme launches, other lenders such as Accord and Virgin Money might sign up.

Mortgage providers such as RBS, HSCB and Lloyds Banking Group have signed up to the scheme, and Barclays and Santander have expressed interest. Lenders who have announced their fees have placed their products competitively, with fees from as little as around £1000. NatWest and RBS have unveiled two-year, fixed-rate mortgages with a starting rate of 4.99 per cent. Halifax will charge 5.19 per cent for a two-year fixed term.

By early November, RBS, NatWest and Halifax had received over 2000 applications in advance of the scheme starting in January 2014. Halifax claimed that around 8- percent of their applications were from first-time buyers. These mortgages are competitive- not in comparison to those buyers who have large deposits themselves, but in relation to the other options available for first time buyers.

 

Reposessions Fall But North-South Divide Widens

There has been a sharp fall in the number of repossessions, but the north-south divide has widened to its largest in six years.

There are 33% more repossessions in the north than in the south, according to detailed research released by e.surv chartered surveyors.

In the north, 72% of towns have higher than average repossessions, but repossession rates are rising quickly in parts of the south-west, south-east and London.

The analysis of court-ordered repossessions in the year to Q2 2013, broken down by postcode, found there were 3.2 repossessions per 1,000 households in the north, a third more than in the south where there are 2.4 repossessions per 1,000 households.

This is the largest gap since the onset of the financial crisis. In the year to Q2 2007, there were 14% more repossessions in the north than in the south, a figure which has been steadily rising.

In total, repossessions fell 17% in the year to July, with 66,544 repossession orders in 2012-13 as opposed to 77,856 in 2011-12. The average rate of orders per 1,000 households fell from 3.3 to 2.8.

A director of e.surv chartered surveyors, said: “On a national level, repossessions are falling, as the economy slowly crawls back to health. Mortgages are becoming cheaper, wages are slowly picking up, and the labour market is showing more vitality.

“But the recovery has been more pronounced in the south, driven forward by booming property and labour markets in the capital and home counties.

“This has been slow to filter through to the north, where seven out of ten northern towns are repossession hot-spots.”

He added: “There is still a long way to go before the northern property market returns to its pre-recession health, and all the while the north is still playing catch-up, and falling further and further behind the south.”

Chester had the highest rate of repossessions at 8.4 per 1,000 in the year to July. Blackpool, Oldham and Wigan were also among the five worst UK towns for repossessions, with 4.5, 4.3 and 4.2 repossessions per 1,000 households respectively.

Romford, Luton and Croydon also had some of the highest repossession figures at 4.4, 4.2 and 4.1 per 1,000 households respectively.