Citizens Advice Can Offer Mortgage Advice Without Charge

May 17th, 2010

The Citizens Advice can provide free help to those who are in arrears with their mortgage repayments or who are having difficulty keeping up with repayments. The CAB saw an increase of over 42% for those coming to them for mortgage advice in 2009 and it is hoped that some property owners may have been able to avoid losing their homes due to this help.

While advice and help may lead to some homeowners being able to get back on track with repayments, this help comes too late for others and repossession is only a matter of time. If you cannot repay your mortgage arrears, you may wish to look into another option such as sell and rent back.

When you take a buy rent back solution, you are allowed to buy back the property at the pre agreed price. Paying monthly rent may be a suitable option if you cannot bear leaving your home and it could provide you with the time needed for you to be able to get back on your feet again. However always ensure that you use a FSA regulated company.

Sell and Rent Back Property on the Rise

July 16th, 2010

Many owners are looking to the new trend of sell and rent back property to save them from foreclosure. The last decade has been a recorded breaking period for interest rates. Borrowers have extended credit well beyond anything that the industry has seen before. Lenders have only aided in the situation.

Now interest rates are on the rise.

Borrowers who took advantage of incredibly low variable rates (ARM) and extended their payments to the edge of their means are now beginning to feel the crunch. Some are learning that the new payments are beyond their income limits. In response, many are looking to lock in an interest rate. For most, it is already too late.

With payments too high to manage, borrowers are struggling to find an answer. Some are looking to the rent to buy industry that is springing up. These companies offer exasperated consumers the option of selling their home (below market value) quickly – sometimes as quick as one week – without any closing fees or other cost associated with selling a home.

After the quick house sale, the consumer can rent the property at a payment that is often less than the mortgage payment. It seems like the miracle answer for many borrowers. For most, this should be the last resort.

Before a home owner turns to the method of sell and rent back property, they should consider all other possible means.

1. If there is equity in the home, it may be possible to refinance at a lower than prime rate – especially if the credit is strong.

2. It may be possible to defer mortgage payments for a couple of months while something is worked out. It never hurts to talk to the lenders, but you must talk to them AS SOON as you realize there is a problem. Don’t put it off.

3. Supplement your income with weekend or evening work while you put the house on the market. Better to downsize than to lose your credit rating.

There are always options that haven’t been considered yet to sell property quickly. There are even private lenders that could be willing to work out a plan. If keeping the house is an absolute must, then look in to options beyond the sell and rent back property industry. In the long run, you will be more satisfied with the results.

Kathryn is a freelance journalist covering the real estate market and covers issues such as how to sell and rent back property. She also covers other property issues on her property blog.

Sellers are going to extraordinary lengths to sell their houses

September 1st, 2010

Here is the good news: the housing market is going to recover. And now the bad news: that recovery is not going to happen in the next 12 months.

Some pundits predict two years, some longer, but one thing looks likely: this autumn and next spring will see prices dipping and homes becoming harder to sell against a backdrop of public spending cuts, tax rises and a continued mortgage famine.

Don’t take my word for it. Ask the growing number of sellers trying to make their homes stand out and sell quickly in a market that is now characterised by too many houses on sale and too few buyers.

Stephen Squires is a retired farmer whose eight-bedroom modern-styled farmhouse near Okehampton in Devon has been on sale for two years through several estate agents. He is now advertising it online (www.tepilo.com, £1.5m) and is offering a £20,000 cash reward to anyone who introduces him to a buyer.

“I don’t want to spend another winter here, so it’s become urgent. We have had several people interested, but they’ve got the usual problem and say: ‘We can’t sell our current house’. So I’m trying something new to see if that works,” explains Stephen, who ran a marketing business in London before heading for the country.

Terry Jennings, an IT businessman, is pursuing a different initiative to sell his listed house in Buckinghamshire (£895,000, Cesare & Co: 01442 827000; www.cesare.co.uk) If a buyer pays the full price he will give them his 36-year-old Triumph TR6 – free.

“The house has been on sale for only a few weeks, but we recognise the state of the market. We’ve got to do something different to create some publicity,” Terry says.

In Nottinghamshire the seller of a modest four-bedroom house is offering a brand new Ford KA, or a discount of the same amount (about £8,000), to anyone who pays the £239,950 asking price (William H Brown: 01777 704248; www.sequencehome.co.uk)

Meanwhile, the new homes market is adopting similar strategies. Linden Homes is offering buyers the chance to have a free conservatory worth £10,000 when they buy in a development at Chinnor in Oxfordshire. And David Wilson Homes is including an annual rail and London underground pass, worth £4,760, for commuters buying flats at its Moove development in Banbury.

Most sellers, of course, adopt more orthodox marketing positions through estate agents’ windows and advertisements in the local papers, but there is growing concern that anyone selling now has to be quick before economic alarm bells ring.

Within the property industry the buzz is of nasty journalists talking down the market with tabloid tales about the twin spectres of public spending cuts and tax rises. But estate agents blaming the media should perhaps look closer to home, for their own colleagues are producing gloomy figures.

Firstly, there are the house price indices. In the spring, all seven major indices, including Rightmove and Hometrack, which rely on estate agents’ data, were showing monthly rises.

Now only two, the Land Registry and the Halifax Building Society, show even the smallest monthly price growth.

“You don’t need to be a fortune-teller to predict what cards a seller can play. Unless their property is a bit of a rarity, the only cards left read ‘chop the price’ or ‘spruce up the presentation’,” Miles Shipside, a director at Rightmove, says. His own index, based on homes on sale, shows asking prices have already dropped more than two per cent since early July.

Secondly, there are forecasts from estate agents’ own research departments. These are almost unanimous in ruling out a crash, but expect gentle falls this autumn and in 2011.

Savills has consistently been an accurate forecaster. It now says mainstream house prices will end 2010 some 2.5 per cent lower than in January with another one per cent fall expected next year. The company’s director of residential research, Lucian Cook, originally expected prices to grow in 2011. However, he admits his change of mind is due to property sales that are now running 20 per cent below even the miserly volume seen last year.

“Transaction levels have been lower despite a slight improvement in the availability of mortgage finance. This reflects faltering consumer confidence seriously undermined by the Coalition government’s policy of austerity measures,” he says.

Another leading estate agency, Knight Frank, agrees but blames over-optimistic sellers for making things worse. “The main complaint of agents is that houses are set to enter the autumn market between five and 10 per cent overpriced. With ‘asking-to-achieved’ prices currently at 95 per cent, the implication of this is that prices are likely to fall back by about five per cent before the year end,” Liam Bailey, the firm’s head of research, says.

He warns that with a combination of a higher volume of homes for sale, weak demand on the back of government spending cuts, rising taxes and weak income growth, the short-term outlook for the market is more challenging than it has been for 18 months.

Colin McKenzie runs C M Property Search, a buying service seeking out homes for busy clients and negotiating the price on their behalf. His advice to sellers who have failed to find a buyer over the summer is simple: cut your asking price by a fifth at least in a bid to draw new interest.

“Three or four months ago, with boundless optimism, your agent suggested an asking price. Since then not only have the prime buyers passed you by, but mortgages have become harder to secure and confidence has fallen away. Corner your agent. Discuss reducing the guide price by 20 per cent or more,” Colin urges.

Some vendors have taken his advice already. Zoopla.co.uk, a website marketing homes and monitoring their sales volumes and prices, says a third of the properties it advertises have cut asking prices. Another online service, propertysnake.co.uk, monitors rival property websites for reductions. It says that more than 215,000 homes currently on sale in the UK have lowered their prices by anything from two to 50 per cent.

But there are less pessimistic voices in the market and some estate agents say that certain areas are bucking the trend.

“Central London prices have slowed to a standstill in recent months and have stabilised at around 11 per cent below their 2007 peak. We are forecasting price growth of five per cent this year followed by three per cent in 2011,” Andrew Stanford of Cluttons explains.

“Don’t assume national statistics apply to the area and market level you’re trying to buy in. Always research locally,” is the advice of Nicola Oddy of Stacks, a buying agency in Cornwall, where many prices are remaining buoyant.

Interestingly, the Council for Mortgage Lenders says its previously pessimistic forecast of growing numbers of owners facing arrears and possible repossession is now not too bleak. “More people with short-term financial difficulties are able to get back on their feet,” a spokesman says.

So when will the storm be over? When can we start taking a more positive view of the property market?

Most analysts say 2012 will see some small growth in house prices in most regions of the UK. By then the strongest austerity measures will have been introduced and the London Olympics may produce a feel-good factor.

And when the turnaround really does occur, it may strike with a vengeance and even return to the large-scale price appreciation so commonplace before the credit crunch.

Research by Savills suggests that an inflation-adjusted rise of 40 per cent in house prices will occur by the end of the coming decade, as a buoyant UK encourages migrants and first-time buyers to get on the ladder again and push demand ahead of supply. So what goes around, comes around. The problem is, it may take some time.

TIPS FOR AUTUMN BUYERS AND SELLERS

For buyers

  • Get your mortgage agreed as quickly as you can. It makes you look like a serious buyer and will give you an edge if there are rival bidders for the same home.
  • Do your research. Use websites, visit during the day and night, make your own price comparisons with other homes on sale in the area.
  • Make sure you present your offer clearly. List details of any chain, your mortgage status, solicitor’s details and moving deadlines.

For sellers

  • Presentation counts. Rectify “barriers to purchase” such as unkempt paintwork or dodgy windows to deter low offers.
  • Be realistic about pricing. Study recent sales of similar homes nearby and make sure your price is low enough to ensure many viewings – that’s key for a sale.
  • The kitchen is the heart. Most buyers say this is a key room, so improve it before selling, but keep its style and quality in line with the rest of the house.

Telegraph

Most of us are still shaking the summer sand from our shoes but estate agents are already in autumn mode, with one question dominating all others: will house prices defy the wider economic malaise of 25 per cent spending cuts and imminent tax rises?

The prospects do not look good. The Rightmove, Nationwide and Hometrack price indices all show small falls over late summer, and the Royal Institution of Chartered Surveyors’ latest measure of sentiment in the industry suggests most estate agents believe prices are now falling.

London’s prices remain relatively strong, but falls are being recorded in almost every other part of England. A survey out this week shows a 3 per cent drop in prices in Scotland over the past three months.

The key forecasters, Savills and Knight Frank estate agents, predict prices will dip further by Christmas, and the house builder Bovis is warning of a “fragile” housing market with confidence sapped by a spectre of unemployment, spending cuts and tax hikes.

The worst problem remains a chronic shortage of mortgages. Santander, one of the biggest lenders, says 1.1m home owners tried but failed to sell in the past 12 months; most were frustrated by prospective buyers who were unable to secure a mortgage.

As a result of all this, many estate agents want sellers to cut their asking prices. Most autumn house sales are in September and October, after which vendors and buyers put plans on hold until the new year. That means there are just eight weeks to do the deal – exactly what Tracy and David Bliss want to do with their Somerset home.

They have cut the price tag of their four-bedroom converted barn at Holton from £895,000 to £800,000. They transformed the wreck into a home 10 years ago and at the height of the market hoped it would eventually sell at £1.2m – but not now.

“We put it on sale at £895,000 at the time of the general election but we’re anxious to sell rapidly and our agent (Palmer Snell, 01935 814531) has advised a price change. We hope people can see through the economic gloom,” Tracy says.

“We’ve painted the interior in neutral colours and we’re part of an open-house weekend in September when people can see the place for themselves,” she says. The couple, both recently retired, had many visitors before the summer but no offers as buyers were either unable to secure a mortgage or have been ultra-picky.

And with a glut of homes on sale – an estate agent typically has 55 properties on the market now, compared with 43 a month ago – buyers can afford to pick and choose.

“There are just over 900,000 homes for sale at present. New stock is being added at the rate of 4,500 a day,” says Henry Pryor of Housingexpert.net. “June’s and July’s sales were up by roughly 10,000 a month on 2009 but were still half what they were in 2006 and 2007.” He says the imbalance of stock on sale over the number of buyers registered with estate agents means there is only an 8 per cent chance of a vendor successfully selling their property in the next month.

Estate agents are particularly worried that buyers will be deterred by wider economic uncertainties and cuts in public spending. There are no official numbers stating how many homes are bought by public-sector staff but Savills says the figure is at least 15 per cent. Some areas are more vulnerable than others: in the North of England the figure is 24 per cent and in the South-west it is 23 per cent.

The key to kick-starting the market this autumn is to get more first-time buyers; this is particularly hard, with most lenders requiring deposits of £40,000 or more. Until far more first-timers enter the market to purchase the smaller homes of existing owners wanting to move, the lowest rungs of the property ladder will remain missing.

The Home Builders Federation (HBF) says first-time-buyer numbers in England and Wales are at a 35-year low. Those who succeed often have financial help from their parents but the HBF says the average age of an “unassisted” first-time buyer is now 37.

University lecturer Elisabetta Barone recently bought her first apartment at a scheme in Wembley, north-west London, built by the developer Quintain. Barone has lived in London for many years but can only now, at 39, afford to buy. She paid £211,000 for the property but even with that budget, she had to compromise on location.

“I’d been house-sitting for a friend in the Docklands but wanted to find somewhere for myself that was new and affordable. Despite falling prices in Canary Wharf, it was still too expensive for me,” she says.

But while estate agents are pessimistic about the short-term prospects, most of the property industry thinks the basic shortage of supply compared with demand will, in the much longer term, see prices go up.

Savills says that by next summer, the growth of the past 18 months will have reversed, leaving house prices at the same levels as in late 2008, some 15 per cent off peak values. But then prices will rise over a sustained period from late 2012 with 3 per cent annual growth. So by summer 2014, they will be back to the pre-recession highs.

The firm believes the only way that forecast will not come true will be if there is a sudden surge in new homes built to meet latent demand – and that is highly unlikely.

The Government’s new planning system – which has involved abolishing plans known as “regional spatial strategies” (RSS), scrapping housing targets and giving local communities a veto over new schemes – is already accused of worsening the housing shortage.

One prominent builder, Cala Homes, is asking the High Court to review the Government’s actions because they leave what the firm calls a “policy vacuum”. A 2,000-home Cala scheme in Winchester was recently turned down for planning permission, after years of preparation, because the strategic local plan had been scrapped days earlier.

This may be just the tip of the iceberg; the National Housing Federation claims plans for 85,000 homes in England have been dropped since the Government came to office.

“The uncertainty created by abolishing RSSs cannot be overstated. It’s going to take nine months before they’re replaced, if they are, and in the interim, almost nothing will happen. Even if new plans come into place, the delay will have set building rates back years,” says Andrew Thomson of BNP Paribas, which funds new housing.

So in the long term, we return to the old story – a growing population outstripping house-building levels. In the immediate future, however, the autumn skies are darkening. House prices, like leaves, are expected to fall in the coming months.

Top Tips For Sellers

* Get ahead of the price curve – a small reduction today may mean less of a drastic (and painful) reduction later.

* Photography is key – make sure the agent’s photographs are good and the best image leads the agent’s website and written details. This doesn’t have to be the front of the property, but could be a breathtaking view, a stunning kitchen or fabulous garden.

* Ensure your property is on with a proactive agent known to work hard.

* It’s obvious, but first-viewing impressions count: mow the lawn, polish brasswork, clean windows, clear clutter inside and complete any outstanding DIY jobs.

Top Tips For Buyers

* Don’t assume national house-price trends apply everywhere – carry out your own research on the internet and in the area where you are planning to buy.

* Make sure you have all of your finances in order and retain a good solicitor so you can act quickly when the right property presents itself.

* Present your offer seriously – show your finance, timescales and intentions to sellers, who will be reassured by your openness.

Source: Connells estate agency

Independent

Exemplar and City of London sign development agreement for London Fruit and Wool exchange site

September 1st, 2010

Exemplar Properties and The City of London Corporation have signed a development agreement for the regeneration of the London Fruit and Wool Exchange site in the City.

Berners Hotel up for sale

August 31st, 2010

Jones Lang LaSalle Hotels has been appointed by administrators of Berners (BVI), to sell The Berners Hotel in London’s West End. 

Property Spotlight: Melia Whitehouse

August 30th, 2010

Maximise the sophistication that London oozes by staying at Melia WhitehouseMelia Whitehouse apartments situated in Regents Park is the ideal place to stay when wanting to take a break in a home away from home that oozes luxury and facilities that will appeal to guests visiting for pleasure or business. You will be staying in an apartment or executive studio that has been furnished with modern and elegant interiors with a fully equipped kitchen and a glamorous marble clad en-suite bathroom. Why not take full advantage of the facilities the Melia Whitehouse has to offer including the award winning A’La carte restaurant, L’Albufera or the Longfords Bar that shows what a true London lifestyle is all about.

For those who wish to stay for pleasure Regents Park’s Melia Whitehouse offers many facilities that will have you occupied when wanting to avoid the hustle and bustle of the capital. There is a fitness centre and gymnasium as well as the room to relax and unwind in. The Melia Whitehouse combines luxury with independence with a fully equipped kitchen for you to experiment with home cooked cuisine supported with maid service.

Business visitors will be able to enjoy the amenities of a business centre where you will be able to hire a meeting room, be provided with faxing, photocopying and printing services and enjoy wireless broadband access. There is also a 24 hour room service to take advantage of after returning from long conferences and a day of meeting prospective clients.

The services and facilities available when staying at the Melia Whitehouse apartments include:

  • Concierge team
  • Quality team
  • Self service laundry room

There is much to see around Regents Park, why not enjoy an exquisite shopping experience around Oxford Street, a fun family day out at the London Zoo or a picnic and walk around the infamous Regents Park itself? For long stays in the capital there are plenty of grocery stores and a Tesco Metro to help you create a masterpiece meal for family and friends to enjoy.

For more information on the Melia Whitehouse apartments, please log on to Refresh Accommodation – we’re specialists in providing London serviced apartments to corporate and residential clients at competitive prices. We can be reached on 08456 8000 80 if you require a free consultation.



Rents increasing as supply falls

August 28th, 2010

A shortage of properties available to let continued to push rents higher during the second quarter of the year, research indicated.

The ongoing problems in the mortgage market, combined with concerns that house prices are falling again, have led to increased numbers of people looking to rent a home, the Royal Institution of Chartered Surveyors (RICS) said.

But despite interest rates being at a record low, making investing in property attractive, landlords are continuing to face problems getting a buy-to-let mortgage.

The group said this had led to the number of homes available to rent remaining low, with supply falling for the fourth consecutive quarter during the three months to the end of June.

Overall, 6% more surveyors said they had seen a fall in new instructions compared with those who had seen a rise, although this was down from 12% in the previous quarter. But at the same time, a balance of 26% of surveyors reported a rise in demand from potential tenants – the second consecutive quarter during which demand has increased at a pace above the long-term average.

The group said tenant demand increased across all regions of the UK, but was strongest in London and the East.

Unsurprisingly, the combination of falling supply and rising demand led to rents rising for the second quarter in a row, with 27% more surveyors saying the cost of renting a home had increased during the second quarter, compared with those who reported a fall. Going forward, a balance of 33% of surveyors expected rents to continue rising, with rents for houses marginally outperforming those for flats.

The group said the market was now very different to a year ago, when rents were pushed down by a flood of properties being made available to let after their owners were unable to sell them.

RICS spokesman James Scott-Lee said: “Supply of lettings property continued to fall in the three months to July although at the slowest pace in a year which, amid rising tenant demand, has helped propel rents higher for the second consecutive quarter. Existing landlords keen to expand their portfolio may still be struggling to access the necessary finance despite improved market conditions.”

Rents increased in all regions of UK, apart from the North, during the second quarter, while only the South West and East saw a rise in the number of properties available to let.

Copyright © 2010 The Press Association. All rights reserved.

Three shortlisted for Lord’s cricket ground redevelopment

August 28th, 2010

Native Land, Almacantar and Capital and Counties have made it through to the final stage of the competition to develop the first phase of a £400m regeneration of Lord’s cricket ground – the Vision for Lord’s.

London and Associated Properties PLC

August 27th, 2010

LONDON & ASSOCIATED PROPERTIES (“LAP”) SELLS
ANTIQUARIUS, KINGS ROAD RETAIL
   INVESTMENT
  FOR [pounds]17.82M 

LAP announces today that it has exchanged contracts unconditionally for the sale of its 65 year head leasehold interest in Antiquarius, located on Kings Road, London SW3, to Cadogan Estates Property Investments Limited for [pounds]17.82m. The property is let to Urbn Limited, trading as Anthropologie and McDevitt Corporation Limited, until 2024 at a combined rent of [pounds]1,150,000 pa. After a head rent of [pounds]68,640 pa this equates to a net initial yield of 5.74%. The book value as at 31 December 2009 was [pounds]17.0m. [pounds]12.75 million of the proceeds will be used to pay down a revolving credit facility and the balance will be added to cash reserves.

LAP was advised in the sale by Lewis & Partners and the purchaser was represented by H2SO.

 Ends.
 Contact:

John Heller, Chief Executive, LAP. Tel: 020 7415 5000

Baron Phillips, Baron Phillips Associates. Tel: 020 7920 3161

Holley and Blake’s Altyon in talks to buy €4bn German portfolio

August 27th, 2010

Altyon Partners is fronting a consortium of investors in negotiations to buy Berliner Immobilien Holding owned by the German federal state of Berlin.

Sapphire retail fund falls into administration

August 25th, 2010

Three shopping centres owned by entrepreneurs the Reuben brothers in a joint venture with Lloyds have been placed into administration after prolonged refinancing talks failed.

Sapphire retail fund falls into administration

August 25th, 2010

Three shopping centres owned by entrepreneurs the Reuben brothers in a joint venture with Lloyds have been placed into administration after prolonged refinancing talks failed.