Friday 19th August 2011

The Centre for Economics and Business Research says house prices will increase by 14% over the next four years.

The ongoing shortage of housing, a gradual increase in the availability of mortgage finance and a prolonged period of loose monetary policy will cause the upsurge in house prices, it says.

Cebr says house building will remain depressed for the next four years and this, combined with population growth, will result in an increasing shortage of accommodation.

It says this is likely to elevate house prices, making home ownership less affordable and placing further pressure on the rental market.

Cebr also predicts that the base rate is unlikely to rise above 2% before 2015.

Shehan Mohamed, economist at Cebr, says: “We forecast an average of 110,000 new homes to be built every year over the medium term.

“This is significantly lower than the 225,000 homes that need to be created every year to keep pace with current housing needs, population growth and the trend towards reduced household sizes.”


Friday 6th May 2011

First-time buyers should 'beware' of new direct-only deals

Advisers should urge potential first-time buyer clients to be wary about swallowing sales stories about deals if they open certain current or saving accounts.

The warning, from Paradigm Mortgage Services, follows a spate of new direct-only offerings from lenders.

They are marketing mortgages available to existing or new current and saving account holders, who are told the mortgages come with high LTVs.

But Paradigm has urged brokers to outline the significant number of caveats that come with such mortgage product options, most notably the fact that there is no guarantee that first-timers who hold, or open, these accounts will actually be offered mortgage finance. 

Bob Hunt, chief executive of Paradigm, said: “While we all welcome lender action in attempting to get more first-time buyers on to the property ladder, we firmly believe that any potential borrower should be speaking with an independent mortgage adviser before making any decision about opening a linked account. 

“Many individuals who have struggled to secure finance in recent times might think that opening a current or savings account with a lender offering a high maximum LTV is the answer to all their prayers. 

“The fact of the matter is that there are no guarantees when it comes to securing mortgages linked to such accounts and the individual would be far better speaking to an adviser in order to ascertain at the outset their mortgage affordability level and whether they are likely to be accepted. 

“There is also the major issue of whether there are any better, and more suitable, deals available for the individual which are not dependent on opening accounts with that provider. 

“Only whole of market brokers will be able to ascertain the true situation for first-timers and therefore we are urging brokers to get this message out into the market and ensure that first-timers do not waste time, energy and potentially money in the search for mortgages which they are never going to be eligible for.”



Friday 8th October 2010

Lenders crunch down on LTVs

Is Cheltenham different from the general change accross the uk?

For the last year Cheltenham Mortgages have seen business steadily increase & we are now very busy - placing mortgages from all range of Loan-to-Values (LTV's) upto 90%.  We are being referred business by existing clients & several professional bodies.    

The 'general' position in the UK is as follows:-

Credit conditions tightened sharply in September for mortgage borrowers buying homes, with the average LTV dropping to 57.2%.

According to e.surv, the UK’s largest surveying firm – part of LSL – it was the biggest fall in LTVs for a year.

The firm says the drop followed the two-year high of 58.1% in August and compares with the peak of 69.4% in October 2006 and the low point of 49.4% in December 2008.

Those on the lowest budgets are being squeezed the most.

The firm’s figures show that whilst in September 2006 borrowers wanting to buy a home priced less than £125,000 typically got a 75.9% mortgage, now they are only offered a 64.3% loan on average.  This equates to the need to find an additional £11,600 deposit on a £100,000 home.

Meanwhile someone buying a home worth £500,000 can borrow just 3.8% less than four years ago. Their average LTV has only declined from 55.6% in September 2006 to 51.8%. 
Tighter LTV criteria have hurt everybody, but those at the bottom of the ladder have been hit disproportionately.

One in five borrowers wants to buy a home worth less than £125,000. They are the classic first-time buyers, but they are still trailing far behind wealthier home buyers in their access to finance. Those financing homes in the £500,000 price bracket are only around one twentieth of buyers. For them, it’s as if the credit crunch hardly happened.

Mortgage purchase approvals rose 1.8% in September compared with August, but remortgage levels sank 13%.

So if you are a first time buyer, or perhaps need a slightly larger LTV than above then please contact Cheltenham Mortgages (01242)700445 


Tuesday 13th April 2010


Tuesday 13th April 2010

Working Lunch on BBC2 @ 12.30pm TODAY!!

Just to let you know Cheltenham Estate Agents & Cheltenham Mortgages were approached yet again by the BBC for our professional thoughts on the UK economy & where we see the Housing Market & Mortgage markets going forward.  This can be seen on:

Working Lunch on BBC2 @ 12.30pm TODAY

OR It can be seen afterwards on:

Latest News:  Homeowners putting their properties on the market!!

The monthly housing survey from the Royal Institution of Chartered Surveyors showed that the balance of opinion among surveyors across the UK is that house prices are still rising, albeit by a slimmer margin than had been the case in recent months.

The seasonally adjusted net balance of respondents reporting price increases rather than decreases was 9 per cent in March, down from 18 per cent in February and 30 per cent in January.

The recent rises in house prices is also encouraging homeowners to put their properties on the market. The balance of surveyors seeing a rise in new instructions to sell rose to 21 per cent, the highest monthly reading since May 2007. The balance was 16 per cent in February.


Wednesday 24th March 2010



Stamp duty

Stamp duty scrapped for first time buyers on properties worth up to s250,000.

Tax credits
Tax credit support for older workers is to be extended. To make it easier for those over 60 to receive working tax credit, the Government will reduce the minimum hours they need to work to be eligible.


A guarantee of a job or training for every 18-24 year-old after six months out of work is to be extended until March 2012.


From next month, the annual ISA limit will rise from s7,200 to s10,200 and ISA limits will increase annually in line with inflation.

Inheritance tax

Inheritance tax threshold will be frozen for a further four years to help pay for the cost of care for older people.

Fuel duty

Fuel duty will rise by a penny in April, followed by a further 1p rise in October and the remainder in January.

The Chancellor said by the time the full rise comes in, in January, he forecasts inflation to be back below 2% and confirmed the Bank of England inflation target remains unchanged at 2%.

Cigarettes and alcohol

Duty on beer, wine and spirits will increase as planned from midnight on Sunday.

Alcohol duties will also increase by 2% above inflation for two further years from 2013.

Duty on cider will increase by 10% above inflation from midnight on Sunday.

Tobacco duty will increase from today by 1% above inflation and then increase by 2% in real terms each year until 2014. 

Small businesses


Over the next year, RBS and Lloyds will provide a total of s94 billion of new business loans, nearly half to smaller firms.

A new Credit Adjudicator will fast-track complaints from smaller firms who say they have been unfairly denied credit. 

Capital gains tax remains at 18 per cent. Entrepreneurs' Relief is doubled to s2 million. A new national investment corporation, to be called UK Finance For Growth, will streamline and improve Government help to small and medium-sized enterprises, overseeing s4 billion of support for business.

A new Growth Capital Fund will provide fast-growing companies with private capital and will eventually provide s500 million of finance - with commercial banks so far agreeing to contribute more than s100 million.

An extra 15% of central Government contracts will go to SMEs, which could mean up to s15 billion of new business across the whole of the public sector.

Business rates will be cut for one year from October, meaning a tax reduction for over 500,000 small businesses in England.

Small businesses will be helped to expand by doubling the annual investment allowance to s100,000.


Other measures

A new guarantee will mean everyone can have a basic bank account, giving up to 1 million more people access to bank accounts over the next five years.


Summary of UK borrowing and debt forecast

Borrowing this year should be s11billion lower than forecast. In 2010/11, borrowing will be s163billion, falling to s131 billion in 2011/12, then s110 billion in2012/13. In 2013/14 it will be s89 billion, reaching s74 billion in2014/15, s8 billion lower than forecast in December.

Debt will be s100 billion lower by2013/14 than was expected at last year's Budget. As a share of the economy, borrowing is forecast at 11.8% of GDP this year, 11.1% next year, then 8.5%. In 2012/13 it will be 6.8%, then 5.2%, falling to 4%in 2014/15.

More than s4 billion from next year's reserve will be allocated to fund operations in Afghanistan.

Public pay settlements will be held at a maximum of 1% for the two years from 2011.

One thousand posts from the Ministry of Justice will be moved out of central London, saving s41 million.




Property market 'returning to normal'

The property market is returning to more normal conditions as increasing numbers of people put their homes up for sale, research has showed.

Estate agents in England and Wales reported a 5.6pc jump in the number of properties they had on their books during March.

But the number of new buyers registering with estate agents rose by only 3.3pc during the month, the first time that increases in potential sellers have outstripped rises in new buyers since January 2009. The group said the supply of homes on the market had already jumped by 10.2pc during the first two months of the year, compared with a rise of only 7pc during the whole of 2009.

Talk of improved market conditions and prices returning to near peak levels in some markets are encouraging a growing number of households to sell their properties.

Many registered buyers are also sellers, and, as they gain the confidence to move, so they need to put their homes on the market. Overall, it seems that we are moving from a sellers' market back towards something more akin to normal market conditions.

House prices in England and Wales edged ahead by 0.3pc during the month, to stand at an average of £158,100, 1.3pc higher than a year earlier. Prices rose in 21pc of postcode districts during March, slightly down on February's figure of 25.5pc, while they fell in 3.6pc of areas.

There was a 13pc jump in the number of sales agreed during the month, while the average amount of time a property is on the market eased slightly to 8.3 weeks. Sellers are now achieving around 94pc of their asking price.

The housing market recovery continues to be led by London and the South East, with prices in these regions rising by 0.6pc and 0.3pc respectively during the month.

But at the other end of the scale, Yorkshire and Humberside reported a 0.1pc price fall, while the cost of property remained unchanged in the East Midlands and North East.

The average home is currently taking just 5.3 weeks to sell in London and 6.3 weeks in the South East, compared with more than 10 weeks in Wales, the East Midlands and the North West.




Here’s some good news for first-time buyers: things are improving on the finance front, with far more appealing deals around now than six months ago and 90 per cent loan to value making a comeback.

The best deals are not necessarily exclusively for first-time buyers, but that’s who will be mainly going for them, with interest rates of around 4.97 per cent on a 10 per cent deposit. You couldn’t get anything like that for the past 18 months.   

The higher the deposit you put down, the better the interest rate you will get and the wider the choice of products as you are considered a lower risk to lenders. Currently a lot of parents are taking money out of their own homes to provide their children with a bigger deposit.

To find out about the best deals, seek the advice of a fully independent broker. “Money and time spent talking to an independent broker is like gold. Don’t think of going it alone. A small fee to a good broker is nothing compared with what you might lose.

Most estate agency-based brokers are tied to either a panel of lenders and insurers or even just one, so you are probably missing out on the choice of deals available; Cheltenham Mortgages, however, is totally Independent!!  

Your home may be repossessed if you do not keep up repayments on your mortgage.

Thursday 17th December 2009

2009 rollercoaster year for mortgages, says Moneyfacts

Tracker mortgage borrowers and investors in the Stock Market rally have had the biggest reason to celebrate this year, said Moneyfacts, but savers and those about to retire have had a punishing year.

Michelle Slade, spokesperson for said 2009 has still been a mixed bag for mortgage borrowers.

“Bank rate falls to an all time low meant those on existing tracker deals or and SVR as low as 2.50 per cent saw their repayments plummet."

She added that plenty of borrowers have been using low interest rates to overpay on mortgages contrary to the Bank of England’s ideal, which would have borrowers go out and spend.

“Borrowers looking to secure a new mortgage deal, particularly a fixed deal, have not seen rates falling as much as they might expect, with rates steadily increasing during the year.

“Only in the last month, as lenders become more accustomed to the post banking crisis world, are we seeing competition start to return to the market, she added.

“Borrowers will be hoping that 2010 will see lenders reducing the perceived excessive margin for risk with rates continuing to fall and that the tentative steps being taken to offer competitive rates at higher LTV levels will continue."

Thursday 3rd December 20009

Economic report for 2009 & prediction for 2010

Cheltenham Estate Agents Senior Branch Manager, Paul Carey, was asked by the BBC to appear on their programme “To Buy or Not to Buy” showing today at 11am on BBC1.  He was asked to comment, in particular, on why the housing market had not been affected as much in Cheltenham.



Neil Burton, Managing Director of Cheltenham Estate Agents & Proprietor of Cheltenham Mortgages report of 2009 and prediction for 2010 is as follows:


Housing market to continue upward trend in 2010

House prices likely to continue to increase moderately by around 5% in 2010

- Positive annual growth in 2009 as a whole

- Housing supply will continue to be poor underpinning prices in the face of substantial demand

- Developers will start to sell off-plan again as a necessity to obtain development finance

- Increased competition in mortgage lending will lead to better deals for borrowers in Q1 2010

- Significant rental income increases forecast for city centres

2009 is already well on its way to ending the year with positive annual growth of around 5%.  The next twelve months are likely to bring modest further growth in house prices and the UK could well end next year with an overall 5% increase.

Whilst the level of house price growth will slow from the current rate of 12% per annum seen over the last six months to be more moderate, there is little evidence that the double dip, a fall to new lows, predicted by many commentators will come to fruition in 2010.

Regional Outlook

Central and South West London are already experiencing better than average house price growth and are expected to continue leading the way in the house price recovery into 2010. South West London will continue to see an above average level of growth as families seek to move to larger properties in the area. These family movers will also push up house prices in the suburbs of all of the major UK cities.

Scotland and the South East look well placed to strengthen and in addition, prime holiday resorts in the South West are also set to see relative strength as many investors are realising that holiday homes in the UK can be just as attractive as those abroad.

There will, however, be significant challenges in areas with large numbers of manual labourers, below average wages and a higher incidence of credit-challenged borrowers. These locations, which are scattered through the whole of the UK, will see weaker pricing and may even experience falls next year, underlining the increasing gap between the haves and have-nots in this new housing market.

Underlying Factors

Supply of Property:

There is an expectation that recent house price strength will bring a flood of sellers return to the market, but any increase is likely to be steady and still outweighed by the larger number of buyers now looking to make their move.

The current undersupply of property is likely to worsen, as housebuilders struggle to deliver any substantial increase in new properties in 2010. Developers are only going to be building around 100,000 units next year whereas at the peak this was around 180,000 units a year, versus a 240,000 Government target.

When coupled with the existing undersupply, this shortfall will provide a major upward pressure on house prices in 2010. In trying to address this lack of supply, housebuilders will return to selling off-plan to enable them to obtain better development funding, a trend already seen starting again in Central London this year.

Interest rates:

Base rates will eventually start to rise, probably in the second half of 2010, and will likely rise to between 1% and 2% by the end of the year. There is a possibility that we could end 2010 with a 3% base rate if the economy begins to rebound strongly but at the moment we cannot see any leading indicators suggesting this.

Mortgage lending:

Mounting Government pressure on lenders to reduce margins and increase lending will be one of the catalysts for maintaining affordability for new property buyers. This will keep payable mortgage rates suppressed even whilst the base rate is rising. I expect lenders to move to offer more attractive products to borrowers within three months of all of the major house price indices moving into positive annual growth, which probably means improving lending terms in the first quarter of next year.


I expect unemployment to top out at between 2.5 and 2.7 million, well below the predicted 3 million touted by most. It is becoming clear that the private sector is reaching the end of its job reduction phase and the question mark now remains more on the public sector – however job reductions here are not expected until well after next year's election, at a time when the private sector economy is likely to be even stronger and this potential increase in unemployment could well be offset by private sector hiring.

Rental market

There are likely to be some winners in the rental market next year, especially in city centres which may be a surprise to some who still believe that city centres’ are over-supplied with rental property. There is substantial undersupply of quality accommodation in the key city centres such as Manchester and Birmingham and this could well drive rental prices up by around ten per cent next year as any remaining stock is soaked up. These rent increases, which I expect to continue in the face of limited supply, will help insulate landlords from the forecast rises in interest rates over the coming years.


Tuesday 6th October 2009

Stamp Duty nil band up to £175K ends 31st December 2009.

Cheltenham Mortgages is remimnding you that the Stamp Duty savings on properties up to £175K ends on 31st December 2009.  

Therefore, to qualify for the savings property purchasers must complete their deals before the 31st December 2009.  Those that buy property for between GBP 125k and GBP 175k, and complete before the deadline date, will save between GBP 1,250 and GBP 1,750.

Monday 28th September 2009

Remutualise Northern Rock, says academic report

A report published today for the Building Societies Association (BSA) reveals a strong case for converting failed banks into mutual organisations. 
In light of the report, the BSA has urged the Government to consider seriously returning Northern Rock bank to the mutual sector.
The report, by the Centre for Mutual and Employee-owned Business at the University of Oxford, concluded that there are three economic arguments for a stronger mutual sector as part of a mixed financial system: 'bio-diversity', risk appetite and competition. 
A financial system with diverse ownership and governance structures is better able to weather the strains of the business cycle than one which is plc-dominated, said the report.

Mutuals can counter-balance the short-termist pressure of the City. Mutuals also help reduce the concentration of financial sector resources and employment in the City, dispersing wealth and welfare to regional and local economies, it added.

In terms of risk appetite, the report finds that mutuals tend to adopt a lower risk profile because their objective is safety and fair pricing for members, not profit extraction for shareholders.

Keeping a reformed Northern Rock independent of the big banks would also be good for competition, it said.  A remutualised Northern Rock would help the Government to meet its policy objective of supporting competition and diversity through the maintenance of a strong mutually-owned financial sector.
The report also said in any exit process the Government needs to achieve optimum value for the taxpayer.  A re-launched and remutualised Northern Rock can repay the taxpayer stake over time. A deferred payment profile can give the optimum outcome, both returning the full value to the taxpayer and achieving other public policy goals. 
The Rt Hon John McFall, MP, chairman of the Treasury Select Committee, said: "This is a timely contribution to the debate on the future of our financial services sector. If ever there was a time for an expanded mutual sector, it's now. We desperately need to restore faith in financial services in this country"
Adrian Coles, director-general of the Building Societies Association, said: "The Government has said that financial mutuals can provide a robust alternative to financial services companies in the future - what better way to demonstrate this than to seriously consider returning Northern Rock to the mutual sector?

"Given that remutualisation would strengthen competition and create a more diversified financial sector, it could be expected to generate an advantage to the taxpayer over the long run in excess of the immediate benefit of any capital proceeds in the short run."


Wednesday 19th August 2009

Lower house prices tempting first-time buyers

First-time buyers are launching back into the housing market according to the latest research from Connells Survey & Valuation, but more recently, home movers and investors have also begun to jump back in.
In the first quarter, 58 per cent of Connells valuations were for first time buyers rising from 42 per cent in the same period of 2008.  In the second quarter, as other buyers began to follow suit, first time buyers fell to 53 per cent of all transactions, and by July, this had dipped to 46 per cent.

Connnells said the recent decline in the proportion of first time buyers comes against a backdrop of an overall increase in the number of house purchases.  Home movers have increased their share from just 35 per cent of mortgage valuations to 44 per cent by July.  There is heightened activity on the buy to let front too, where investors have increased from just one in fourteen buyers earlier this year to one in ten in July, it added.
The strength of first-time buyer activity comes against a strong headwind of tough lending criteria, which has made it difficult for first timers to access credit. Significant deposit requirements remain and higher affordability and credit scoring thresholds are undoubtedly preventing many from obtaining mortgage finance.
Data from the Department for Communities and Local Government shows house prices are more affordable now than at any time since 2003. 

The trends in Connells data suggest that housing transactions should have increased to almost 40,000 by June, with a similar number in July, up 53 per cent from the record low in January.
Ross Bowen, group mortgage director for Connells said: “First-time buyers are having a hard time when it comes to obtaining finance but this hasn’t stopped them hunting for bargains. For first-timers house prices are cheaper than they have been for years, and there is pent up demand. 
“The overall numbers of houses changing hands are recovering, which combined with rising house prices over the last five consecutive months is encouraging.  However, funding constraints remain a significant barrier to any step change in housing transaction levels.
“First time buyers are crucial to the long term health of the market and continuing to support their entry to home ownership must remain a top priority for us all.”

Monday 13th July2009

NAEA calls for more government initiatives on property market

Estate agents want more intervention from banks and the government to sustain the housing market improvement.

Property sales levels are up, according to the National Association of Estate Agents (NAEA) but with fewer properties available the number of people searching for properties fell in May.

Buyers are also increasingly realistic about lowering prices and negotiating so the difference between asking and selling prices shrank to just 1.9% - down from a 6.3% difference in June, according to agents.

The average estate agent had 290 house hunters registered in June, down from 299 in May. They had 64 properties for sale, down from 69 in May and a high of 100 in December 2008.

NAEA President Gary Smith said: "The housing market is in a far stronger position than it was 12 months ago. After several months of continuous improvement the market stabilised in June, ahead of an expected seasonal dip throughout the summer.

He continued: “It is in the interests of the UK as a whole that the upturn in the housing market that has been noted in the first half of 2009 is sustained and nurtured into a full recovery. The Government must do more to ensure that money that has been given to banks finds its way through the system and into the housing market."

The average professional agent sold 10 homes in June for the third month in a row, double the amount sold during the worst of the market downturn in August 2008.

Friday 3rd July 2009

House sales up 36.3% on June last year

The latest results from June’s Property Activity Index shows that the residential housing market could be on the road to recovery.

The Index, based on the volume and activity status of ‘For Sale’ and ‘Sold’ boards across the UK, rose to its highest level for 14-months.

This is up 19.2 per cent since May 2009. Year-on-year there were 36.3 per cent more sales in June 2009 than June 2008.

The West Midlands saw the greatest monthly increase with a staggering 58.7 per cent rise, followed by the East Midlands, with a 35.1 per cent increase and Yorkshire with a 28.8 per cent increase. The regions experiencing the lowest increase in sales were Wales which remained static, London where there was a 7.6 per cent increase and the North East with 8.3 per cent sold signs.

The regions showing the greatest monthly increase in the number of ‘For Sale’ boards being put up are the East Midlands at 37.4 per cent, followed by Yorkshire with 26.0 per cent and London at 25.4 per cent. Those with the smallest monthly rises of For Sale boards were Scotland at 2.1 per cent, the North East at 13.9 per cent and the South East at 15.4 per cent.

A spokesman said “The Index shows that there are grounds for continuing optimism that we have seen the bottom of the market.”

Thursday 14th May 2009


Brokers ranked as most trusted in financial services


Brokers and advisers have come out on top in a consumer survey on trust within the financial services industry.

Nottingham University Business school has put together the latest Trust Index on behalf of the Financial Services Research Forum which measures how trusting consumers are of the industry.

It found that brokers and advisers received the highest rating on trust and trustworthiness at 81.67.

Brokers and advisers have consistently been ranked the most trusted among financial services firms though have experienced a marginal decline this year.

Findings in the latest study, which has been running since 2005, rank independent brokers higher than tied ones.

Banks, life insurance companies and credit card companies received the lowest ratings, at 73.96, 72.69 and 71.55 respectively.

Overall the sector earned a trust rating of 75.02, and was deemed more trustworthy than institutions such as the National Health Service and the BBC.

Professor Nigel Waite, director of Financial Services Research Forum, said: “It has been widely assumed that the combined effects of the credit crunch, global recession and the banking crises would lead to a crisis in consumer trust in financial services.

“It may be an inconvenient truth, but the reality is that trust in the financial services industry is not at rock bottom.”

He adds: “If the research tells us one thing, it is that the government and regulator must move the debate surrounding the future of financial services onto a more constructive footing.

“Significant levels of consumer trust do exist, which should serve as a foundation on which to alleviate the current economic crisis.”

Tuesday 5th May 2009

Housing affordability trebles

Home affordability for first-time buyers is improving, it has been claimed.

According to Halifax's latest FTB Affordability Review, which tracks the relative ease with which buyers can get on the property ladder in 297 local authorities, the number of regions where owning a house is within reach for first-time buyers has more than trebled since 2007.

The average price paid by would-be homeowners was deemed affordable by Halifax in 21 per cent of local authorities, compared with just six per cent in the third quarter of 2007.

According to the bank's key price to earnings ratio, affordability for buyers is the best it has been in six years.

House price to average earnings has fallen from 5.84 per cent in July 2007 to 4.34 per cent in March 2009 – a fall of 26 per cent.

However, affordability indices are of little help to buyers when mortgage approvals were down by seven per cent month-on-month in March and 25 per cent when compared with March last year.

Wednesday 22nd April 2009 

Budget 2009: A point-by-point guide

This afternoon, Chancellor Alistair Darling outlined his plans and expectations for the economy over the next 12 months. 


Cheltenham Mortgages brings you a point-by-point guide of the relevant points.


  • Stamp Duty ‘holiday' - with no Stamp Duty payable on transactions up to £175,000 - extended until the end of the year.


  • Extension of the Support for Mortgage Interest scheme, which covers mortgage interest payments for those who have lost their jobs, for a further six months.


  • The major UK banks will increase the availability of mortgages by around £20bn this year.


  • Mortgage-backed securities guarantee scheme, based on the recommendations of Sir James Crosby, introduced from today following State Aid approval.


  • Further £80bn of funding for HomeBuy Direct shared equity scheme.


  • Restriction on pension tax relief for those with incomes in excess of £150,000, gradually tapered to the 20% rate.


  • New income tax band of 50% for those earning in excess of £150,000 to come in from next April.


  • £500m package to help housebuilders kickstart stalled housing projects.


  • A report on the reform of regulation to be published by the Treasury shortly, to improve regulation of capital and liquidity so that banks do not overstretch themselves and strengthen regulators' powers.


  • Increase in the ISA limit to £10,200, for the over 50s from this year, and for everyone else next year. Of the new limit, £5,100 can be saved in cash only.

Wednesday 15th April 2009

Buyer interest gaining momentum, says RICS

Enthusiasm amongst buyers is gaining momentum as new buyer enquiries rise for the fifth consecutive month, the latest data from the Royal Institution of Chartered Surveyors reveals.

Some 31% of chartered surveyors reported an increase in new buyer enquiries during March, up from 21% in February.

Buyer enthusiasm in London was particularly strong with 63% of surveyors seeing enquiry levels pick up in March, compared with 46% the previous month.

RICS says this interest is starting to filter through to sales, although transactions remain at historically low levels.

Supply of properties for sale also remains limited as surveyors report the level of new instructions remains in negative territory.

A spokesman for RICS says: “"Buyer interest is starting to gain real momentum but will remain frustrated while mortgage finance is scarce.

“Surveyors are optimistic that transaction levels will increase, especially for those with the finance to purchase family homes.

But he adds: “The market is still in a fragile state but with demand continuing to pick up there may be more signs of stabilisation in the coming months."

Monday 23rd March 2009

Call for high LTV guarantees
Tony Ward, chief executive of Home Funding, is calling on the government to attach guarantees to all UK mortgage lending between 75% and 95% LTVs.

Ward has written a paper entitled ‘Kick-starting the mortgage market’ which will be sent to key government figures this week.

The key recommendations contained within the report include the need for the government to move away from focussing on funding models and provide support at mortgage level instead.

Ward argues that government guarantees for mortgage lending above 75% LTV and up to 95% LTV would work on the basis of the lender and government sharing the risk of higher LTVs.

Both parties would then have a shared interest in minimising risk on these loans.

He also wants to see the current surplus of mortgage-backed securities being removed from the system, in order to set “proper values” to new issues.

Tony Ward, chief executive of Home Funding, says: “Some excellent thoughts have emanated from the Bank of England and the Treasury but there is a real risk they will get bogged down in the detail of how things operate at a micro level.”

He adds: “We shouldn’t try to fix banking; instead we need solutions that put money directly into the hands of struggling home buyers and owners.

“By attaching a guarantee to mortgages we can move away from worrying about whether banks or non-banks should be assisted and look to a more holistic approach to assist our ailing economy.”


Wednesday 25th February 2009

RBS and Lloyds 'will pledge to increase mortgage lending by £40bn'

Royal Bank of Scotland and Lloyds TSB will this week pledge to increase new mortgage lending by more than £40 billion as part of the Government's latest bail-out of the country's high-street banks.

The two banks have agreed to increase loans to homeowners and small businesses in return for about £500 billion of taxpayers' assistance. The deal will be announced before the end of the week.

The commitment follows a similar pledge by Northern Rock earlier this week to boost lending by about £14 billion over the next two years.

It is hoped that the lending pledges will help kick-start the housing market. Other banks participating in the Government bailout will also have to make similar specific commitments.

Hundreds of thousands of borrowers have recently struggled to obtain credit from banks which has plunged many people into financial turmoil.

It is the first time that the banks have been forced to put specific figures on how much extra they will lend as a condition of Government support.

Lending has continued to fall over the past few months despite intense pressure from Gordon Brown and Alistair Darling on the banks. Mortgage lending last month slumped to less than £10 billion - less than half the level of January 2008.

RBS and Lloyds are currently locked in discussions with the Treasury over the latest Government bailout. The Government is expected to underwrite about £250 billion of assets or debts from each bank.

The scheme is intended to protect banks from debts not being repaid or assets dropping in value. The banks will only lose a fraction of their value if this occurs and the taxpayer faces a large bill on the loss.

The exact details of the scheme are still being worked out. However, both banks are understood to have agreed to the new lending pledge. If they fail to meet the commitment, they may lose Government cover for their questionable assets.

A well-placed source said: "A key part of the deal is going to be each bank announcing a specific figure for new lending. A verifiable commitment. It is still being negotiated but we are talking about tens of billions of pounds."

Banking sources confirmed that both RBS and Lloyds Banking Group had agreed to lend more than £20 billion each in additional lending. The pledge may be even higher depending on the terms of the bailout. Lloyds is also understood to be negotiating to reduce the fees or interest it pays the Government for previous assistance.

The lending commitment goes far further than previous pressure applied by the Prime Minister on the banks. Mr Brown called on the banks to return lending to 2007 levels as part of the last banking bailout. However, critics said this pledge was vague and unspecific.

The banks are also expected to be under pressure to pass future interest rate cuts on to borrowers. A survey published yesterday found that two-thirds of lenders have failed to pass on any of this month's reduction in rates.

Just 31 out of 91 lenders with a standard variable rate mortgage have announced that they will be reducing the interest rate on the schemes following the 0.5% cut to the Bank of England rate, according to Moneyfacts.

The American Government are also rushing to shore up the US banking system. Ben Bernanke, the head of the Federal Reserve, said yesterday that unless banks were quickly "stabilised" the recession could last for years.

Friday 20th February

Banks 'should ensure credit flow'

Nationalised banks should be used to improve the flow of credit and revive the mortgage and property markets, it has been claimed.

According to Liberal Democrat Treasury spokesperson Vince Cable, the government has effectively nationalised the Royal Bank of Scotland and taken a significant stake in Lloyds TSB.

He claimed that despite this, the public accounts made available by the ailing institutions will only include their liabilities and not their assets.

Mr Cable added: "Ministers must now accept the reality that they effectively own two large banks and use them to ensure the flow of much needed credit into the economy."

Yesterday, the Confederation of British Industry said Gordon Brown lacked a coherent recovery plan to save the economy.

Meanwhile, the Office for National Statistics added RBS's £1.5 trillion worth of liabilities to the taxpayer's balance sheet.

Kenneth Clarke, the shadow business secretary, told the BBC: "We are going to quite staggering levels of public debt."

Monday 16th February 2009

Sellers' optimism pushes house prices up by 1.2%

False optimism amongst sellers has prompted a 1.2% rise in house prices over the past month, figures from Rightmove reveal.
The Rightmove House Price Index for February shows that properties are coming onto the market an average of £2,593 higher than January.

But annual house prices continue on the downward trend, with house prices now 9.1% lower than this time last year.

This is the largest annual drop in house prices that Rightmove has ever recorded.

Yet enquiries are flooding in at record levels, with enquiries during January up 108% on the previous year.

Miles Shipside, commercial director of Rightmove, says: “Serious sellers need to set their initial asking price more realistically to get one up on the competition and
take advantage of increasing numbers of bargain-hunters who have set their own price floor ahead of the return of mainstream purchasers.”

Shipside says enquiry levels are not translating into sales as stringent lending criteria is brought to bear.

He adds: “Some agents report only one deposit-strapped enquiry in 40 being able to get a mortgage, with current deposit and income multiple restraints singling out aspiring first-time buyers.

“Unfortunately, the current enquiry feast is being blunted by the mortgage famine.

“While leaving a great opportunity for the cash-rich to strike a deal, it also highlights the extent to which the financial sector needs to put its house in order before market recovery can truly begin.”

Tuesday 3rd February 2009

Independent Mortgage Advice "ESSENTIAL"

Buyers have been urged to seek professional advice when taking out a mortgage by industry experts.

There are so many products available to potential buyers that people need expert advice when choosing a deal.

"They should consult an independent broker so they will get advice on the whole of the market and it will all be explained to them. 

It is impossible to fully compare deals by searching online and in newspapers or by using price comparison sites.

Professional mortgage advisers will also help borrowers get to grips with mortgage terminology”

The announcements follow a recent survey by Halifax which suggested many borrowers do not understand all the terms used in their mortgage deal.

Almost a fifth were unable to explain what a mortgage completion date was!!


Monday 26th January 2009                                                                        
Latest Credit Card Scam....
 This one is pretty slick since they  provide Y O U with all the information,                                   
 except the one piece they want.                                                                                
 Note,  the callers do not ask for your card number; they already have it.                                      
 This  information is worth reading.  By understanding how the VISA &                                           
 MasterCard Telephone Credit Card Scam works, you'll be better prepared to                                      
 protect yourself.                                                                                              
 One of our employees was called on Wednesday from  "VISA", and I was                                           
 called on Friday from "MasterCard".                                                                            
 The scam works  like this: Person calling says, "This is (name), and                                           
 I'm calling from the  Security and Fraud Department at VISA. My badge number                                   
 is 12460.  Your card  has been flagged for an unusual purchase pattern, and                                    
 calling to verify.   This would be on your VISA card which was issued by                                       
 (name of bank) did you  purchase an Anti-Telemarketing Device for £497..99                                     
 from a Marketing company based  in London ?"   When you say                                                    
 "No", the caller                                                                                               
 continues with, "Then we will be issuing a  credit to your account.  This                                      
 is a company we have been watching and the  charges range from £297 to £497,                                   
 just under the £500 purchase pattern that flags  most cards.  Before your next                                 
 statement, the credit will be applied to your account.  I just need to confirm your address (gives you your    
 address), is that                                                                                              
 You say "yes".  The caller  continues - "I will be starting a                                                  
 fraud investigation.  If you have any questions,  you should call the number listed on the back of your card   
 and  ask for the Security & Fraud Department.                                                                  
 You will need to refer to this Control Number.   The caller then gives you a                                   
 6 digit number.  "Do you need me to read  it again?"                                                           
 Here's the IMPORTANT part on how the scam works  the caller then says,                                         
 "I need to verify you are in possession of your card."  He'll ask                                              
 you to "turn your card over and look for some numbers."  There are 7                                           
 numbers; the first                                                                                             
 4 are part of your card number, the next 3 are the security numbers that verify                                
 you are the possessor of the card.  These are the numbers you sometimes use  to                                
 make Internet purchases to prove you have the card.  The caller will ask  you to                               
 read the 3 numbers to him.  After you tell the caller the 3 numbers,  he'll                                    
 say, "That is correct, I just needed to verify that the card has not been                                      
 lost or stolen, and that you still have your card.  Do you have any other                                      
 questions?"  After you say, "No," the caller then thanks you and                                               
 states,  "Don't hesitate to call back if you do", and hangs up.                                                
 You  actually say very little, and they never ask for or tell you the Card                                     
 number.   But after we were called, we called back within 20                                                   
 minutes to  ask a question.  Are we glad we did!  The REAL VISA Security                                       
 Department told us it was a scam and in the last 15 minutes a new purchase of                                  
 £497.99 was charged to our card.                                                                               
 Long story -  short - we made a real fraud report and closed the VISA account.                                 
 VISA is  reissuing us a new number.  What the scammers want is the 3-digit PIN                                 
 number on the back  of the card.  Don't give it to them.                                                       
 Instead, tell  them you'll call VISA or Master Card directly for                                               
 verification of their  conversation.  The real VISA told us that they will never                               
 ask for anything  on the card as they already know the information                                             
 since they issued the card!   If you give the scammers your 3 Digit PIN                                        
 Number, you think you're  receiving a credit.  However, by the time you get                                    
 your statement you'll see  charges for purchases you didn't make, and by                                       
 then it's almost too late and/or  more difficult to actually file a fraud                                      
 What makes this more  remarkable is that on Friday, I got a call from a                                        
 "Jason Richardson of  MasterCard" with a word-for-word repeat of the                                           
 VISA scam.  This time I  didn't let him finish.  I hung up!  We filed a                                        
 police report, as  instructed by VISA.  The police said they are taking several                                
 of these  reports daily!  

Monday 19th January 2009

Govt unveils new set of bailout measures

Gordon Brown, the Prime Minister, and Alistair Darling, the Chancellor, have unveiled a new series of bailout measures, designed to support the banking industry and spark new lending.

The Bank of England will be tasked with creating a new fund worth up to £50bn tasked with helping the corporate sector. It will take securities and assets in return for that money going into the economy.

The Treasury explained that the programme will give the MPC the option of using asset purchase for monetary policy purposes, if it deems this would help the economy meet the inflation targets.

The Government has confirmed it is extending its credit guarantee scheme - which is designed to reduce the risks of lending between banks - until December.

It has also acted on the recommendations of Sir James Crosby by launching a guarantee scheme for asset-backed securities to help support lending. The Government will provide full or partial guarantees, attached to triple A rated securities from April, with those lenders able to access the original credit guarantee scheme eligible for this further scheme.

The Treasury pledged to get the wholesale markets moving again, stating: "Mortgage-backed securities supported a third of mortgage lending and the revival of this market is an important element of increasing the capacity of lenders to provide mortgages as demand increases in future."

The Government has also decided that it is not “appropriate” for Northern Rock to shrink its assets, and rather to maintain its lending levels.

Darling explained additional capital would be placed into the Royal Bank of Scotland Group, due in part to losses due to the situation in the US.

The FSA will also issue a statement later today, to clear up its expectations on bank capital ratios, to make clear there are no new statutory requirements for capital.


Public expects housing revival this year

Monday 5th January 2009

Conveyancing firm Barnetts Solicitors has reported strong public confidence in a housing market revival during 2009.

It said that 52% of 4,301 people polled in December 2008 expect the UK housing market to start moving again within 12 months.

Of those, 30% believe house prices will have bottomed out by the summer and only 23% expect it to take longer than 18 months.

The news follows the RICS prediction that property prices may have already bottomed out and could rise by 10% in 2009.

Richard Barnett, senior partner at Barnetts, said: “This is a strong sign that people expect the markets to pick up before 2009 is out, once the current correction for previous over-inflation completes. This is exactly the kind of optimism we will need to kick-start the recovery process.

“It was reported last week that tycoons such as billionaire John Caudwell are already starting to invest in the afflicted commercial property market. I’ve always said that investors returning to the markets will be our clearest indicator that prices are bottoming out.

“As RICS and the National Association of Estate Agents (NAEA) have suggested, many in the industry expect the recovery process to move rapidly, mirroring the speed the slump itself set in. The challenge for us now is to be poised to respond to the upturn and the opportunities it will bring, but demonstrate flexibility and resilience until that time comes.”

Government alters mortgage support

Tuesday 23rd December

Ministers have announced that the waiting period before claimants can receive state benefits in the form of "support for mortgage interest" (SMI) will be shortened to three months on January 5th.

Currently the period stands at nine months.

The change will apply to mortgage holders who are eligible for income-related benefits such as Jobseekers' Allowance.

SMI means that people receive help on the first £200,000 of their mortgage, with the cash going straight to the lender.

The amount individuals receive is calculated on an interest rate of 6.08 per cent.

Commenting on the move, James Purnell, the work and pensions secretary, says: "We have made sure that as many people as possible will benefit from the increased support with their mortgage interest payments by bringing in the new rules as soon as we can."

He adds that people who are concerned about their mortgage should not have to wait any longer than necessary for help.

Last week, it was reported by uSwitch that some two million people in the UK are hoping to take a payment holiday on their mortgage to safeguard against job losses.

AMI welcomes base rate reduction

Friday 5th December 2008

The Association of Mortgage Intermediaries (AMI) has welcomed the monetary policy committee's decision to slash a further one per cent off the base rate - but has called for further intervention in the mortgage market.

Director of the AMI Chris Cummings said the one per cent cut shows the Bank of England understands the seriousness of the current economic situation.

Mr Cummings claimed: "This cut is essential to try to boost the ailing economy."

"However, on its own, this move will not have the positive effect we need to get the mortgage market lending again," he added.

Mr Cummings called on the government to implement recommendations put forward by its mortgage industry adviser Sir James Crosby without any further delays.

In related news, the Council of Mortgage Lenders welcomed government plans to give a two-year interest rate reprieve to borrowers struggling with their monthly mortgage repayments, but said the scheme needed to be properly targeted.

Over paying 'could take years off your mortgage'

Monday 24th November 2008

People with tracker mortgages have been advised to forgo the benefits of the recent base rate cuts in the interests of reaping the rewards later.

Tracker borrowers are currently enjoying the effects of the Bank of England's unprecedented two per cent interest rate cut, however, savvy savers will keep paying their pre-cut rate in order to pay off their mortgage quicker, the Daily Mail reports.

Drew Wotherspoon from mortgage broker John Charcol is quoted by the news provider as saying: "Borrowers with existing trackers should use rate cuts to their advantage to pay off their debt quicker."

However, he also advised that "borrowers with expensive debt elsewhere, such as credit cards, should concentrate on paying this off first", before taking advantage of the rate cuts.

People with tracker mortgages of £100,000 spread over 25 years will be saving approximately £110 per month, but if they keep paying their usual rate through the cuts could pay off their mortgage six years early with a saving of £11,666.

It has been predicted that the cost of borrowing could fall even further than the current three per cent base rate to as low as one per cent during 2009.

Lenders bite the bullet and pass on full rate cut


Several lenders have already surrendered to growing pressure and passed on the full base rate cut to borrowers on SVRs.
Brokers, trade bodies and con-sumers have been united in their response to the 1.5% base rate cut by calling on lenders to pass it on in full.

Several lenders said they will do so on Thursday and Friday. confirmed that Halifax, the Royal Bank of Scotland, NatWest, Nationwide and Abbey have pledged to pass on the full rate cut, as have Scottish Widows, Cheltenham & Gloucester, Lloyds TSB and Northern Rock.
Base rate falls by a massive 1.5%Base rate falls by a massive 1.5%

Thursday 6th November 2008

The Bank of England has slashed the interest rate by a whopping 1.5% bringing it down to just 3%.

The cut from 4.5% is the largest cut by the Monetary Policy Committee since it was set up in 1997 and the first time the interest rate has fallen to 3% since 1954.

Ben Thompson, mortgages director at Legal & General, says: “The cut today is welcome, but sadly many borrowers aren’t going to benefit.

"There’s no obligation for lenders to reduce their standard variable rates and if last month is anything to go by, most will be reluctant to cut their SVRs significantly because these rates look relatively good value at the moment.

"However, swap rates are gradually starting to come down, albeit much slower than we would like, and this should have a knock-on to fixed rate pricing.”

Number of first-time buyers 'on the increase'

Number of first-time buyers 'on the increase'Wednesday 5th November 2008

The number of first-time buyers entering the market increased between August and September, it has been claimed.

According to the National Association of Estate Agents (NAEA), the number on its members' books rose from 8.3 per cent of total purchases to 9.5 per cent.

The announcement from the NAEA comes after figures were released showing mortgage approvals increased by ten per cent during the same period to 23,422.

Mortgage lending reached an all-time low in August, according to the Bank of England.

Leslie Deans, senior partner of Leslie Deans and Co, said: "Things are now considerably better than they were six weeks ago."


Mortgage market outlook “promising”

Friday 31st October 2008

Managing Director of haart, Russell Jervis, has commented on Nationwide’s October house price index: “House prices have now been falling for twelve consecutive months. However, despite the threat of a recession knocking consumer confidence, vendors who are prepared to accept estate agents’ advice and adjust their price expectations in line with the market are having success in agreeing a sale. This is particularly true as buyers are beginning to take the opportunity to move up the ladder while prices are low, which is something that many were struggling to do in 2007.

“While there is still activity in the market, the bank bail out plan coupled with the reduction of the base rate to 4.5% has not yet had the positive impact that we would have hoped. However, the foundations have now been laid for improving liquidity and we are seeing interbank lending begin to thaw as the LIBOR continues to fall. These are promising signs that competition is returning to the market and more mortgages
will be made available.”

Competitively-priced homes 'will sell'

Friday 31st October 2008

Upbeat analysis of the housing market was issued by property website Mouseprice today.

According to experts at the site, sellers can still expect their homes to be snapped up quickly - just so long as they are realistic about its asking price.

Over recent months, the credit crunch has resulted in restrictions on sub-prime and other types of mortgage loans - helping to drive down house prices.

Moreover, there have been suggestions that many sellers are in denial about the downturn - with latest figures from surveyors showing that the average home sells for nine per cent below its initial asking price.

Selwyn Lim, director of Mouseprice, said: "You get situations where if prices are going down people are almost irrationally reluctant to sell at the lower levels.

"If you price the property competitively then it is perfectly possible to get a quick sale. The length of time on the market is really dictated by how aggressively the person prices the property."

Latest house price figures from Nationwide suggest that the average home has lost 14.6 per cent of its value over the past 12 months.

Downward trend of Libor means boost for homebuyers

Thursday 30th October 2008

As yesterday marked the twelfth consecutive daily fall in the Libor rate of inter-bank borrowing, Sales Director of Independent Mortgage Helpline, Nick Rhodes, has spoken out: "The twelfth consecutive fall in the Libor rate will bring a welcome boost to homebuyers, as the freeze in interbank lending begins to thaw.

"The huge injection of cash by the Government's rescue plan is beginning to filter through the markets, giving banks the confidence to start lending to one another again. We can expect to see a positive knock on effect over the coming weeks as competition returns to the market, bringing more choice to consumers. Prepare to see lenders increasing the number of mortgage deals on the market and more favourable rates, which can only be good news for homebuyers."

Lenders 'boosting risk margins' through rate reductions

Lenders 'boosting risk margins' through rate reductionsTuesday 28th October 2008

This month's 0.5 per cent base rate cut from the Bank of England has helped to boost mortgage lenders' profits, a new report suggests.

Financial website claims that 38 per cent of savings account providers and 44 per cent of mortgage firms have pledged to reduce their rates, following the central bank announcement.

However, the report shows that, unlike the savings rate cuts, many of the mortgage reductions are not made to the full 0.5 per cent - effectively boosting many firms' risk margins.

Michelle Slade, analyst at, commented: "When base rate was cut, consumers thought they were finally going to start feeling some relief on their overstretched finances. They expected their savings rates to decrease, but thought they would feel the benefit by reduced mortgage repayments.

"Unfortunately the providers have used the cut as a way to shore up their balance sheets. Although it is well publicised that the banks and building societies need to do more to improve their current financial positions, consumers will feel bitterly disappointed that they are not feeling the benefits."

Speaking to Channel 4's Dispatches programme recently, former Bank of England policymaker Charles Goodhart suggested that the base rate might soon be cut to zero, due to the severity of the current economic downturn.

Lenders should 'wake up', expert says

Lenders should 'wake up', expert saysMonday 27th October 2008

Mortgage lenders need to scale back their growth plans over the months to come, an industry expert has said.

The Homeowners Advice Centre also advised the firms to pass on Bank of England rate cuts to customers straight away, in order to alleviate the ongoing property market downturn.

Over recent weeks, many lenders have imposed hikes on their tracker rates, rather than mirror the Bank of England's 0.5 per cent base rate reduction.

Others have also not imposed the cuts on their standard variable rates.

the continuing credit crunch, which has largely frozen inter-bank lending - a big source of lenders' funding.

Recent figures from the Council of Mortgage Lenders showed that 42,000 loans were approved in August - down from 103,000 during the same month in 2007.

Al Elliot, advisor at the Homeowners Advice Centre, said: "This period is about consolidation of their outstanding mortgage book, not exploitation and profit chasing, and that profit margins are going to be much slimmer this coming year.

"One immediate way that would help all homeowners, particularly first-time buyers, would be for all lenders to undertake to pass on interest rate decreases straight away, allowing borrowers to benefit from the lower standard variable rate."

The Homeowners Advice Centre specialises in giving debt advice to mortgage holders who have fallen behind on payments - many of whom having taken out the loan despite having previous adverse credit.


Repossession guidance unveiled by Brown

Repossession guidance unveiled by BrownThursday 23rd October 2008

New plans for people threatened with home repossesson have been unveiled by the government.

Britain's judges are to ask lenders to show them that they have used all other avenues other than taking back a property, when repossession cases come before courts.

This is likely to mean that upcoming repossession actions will be stopped - and will only now go ahead if lenders prove that they have no other choice but to proceed.

The new guidance was unveiled by Gordon Brown in Parliament today.

Speaking to the BBC, head of consumer policy at Citizens Advice, Sue Edwards, said that the new rules would be a good idea.

"This timely introduction of a pre-action protocol for mortgage arrears will ...ensure that court action is only taken as a last resort where all other options have failed and no agreement can be reached," she told the broadcaster.

Mortgage repossession numbers in the UK are set to jump from 26,000 to 45,000 between 2007 and 2008, lenders have said.

Your Move calls for return of the 95% mortgage

Your Move calls for return of the 95% mortgageFriday 17th October 2008

The property market in the UK can only recover with the re-introduction of very low deposit loans, Your Move said today.

New analysis from the firm suggests that only the re-introduction of mortgages  which require a deposit of just five per cent will stimulate the property sector, by encouraging people to buy again.

Due to the credit crunch, these "95 per cent" deals have been pulled by high street lenders - along with still more generous deposit-free, or 100 per cent, deals.

The comments follow recent research from the Co-operative bank, which found that the average first time buyer estimated that they needed to have £19,000 saved for a deposit, in order to get on the property ladder.

Gareth Samples, sales director at Your Move, said: "The first-time buyer mortgages at 90, 95 and 100 per cent were pulled and that takes a whole sector of the market out.

"Until those things are put back in place – and I don't think a 100 per cent mortgage ever will be, but maybe a 95 per cent loan to value mortgage [might] – then it's not going to get that much better."

Lender Halifax estimates that house prices have dropped by 13 per cent in the current downturn - and research from estate agency Knight Frank forecasts a further 15 per cent fall before the market bottoms out.

Sale and rent back 'should be better regulated'

Sale and rent back 'should be better regulated'Wednesday 15th October 2008

The Office of Fair Trading (OFT) has released the results of its investigation into the sale and rent back sector.

It called for new laws to be passed in order to protect consumers, after finding that some people enter into such arrangements when it is not the "best option" for them.

Sale and rent back is commonly used by homeowners who are behind on their mortgage payments, but wish to continue living in their property.

They sell their home for a reduced sum and then the buyer pays a monthly rental fee.

However, the OFT found that some firms "mislead" customers over the value of their property - and that some oblige the tenants to leave when they do not want to.

This can either be through imposing a rent increase, or even eviction.
John Fingleton, OFT chief executive, said: "Our research shows that sale and rent back deals have potential to cause serious and permanent harm to often vulnerable homeowners.

"The unfamiliar and highly pressurised situations that these people find themselves in may leave them particularly vulnerable to misleading statements or valuations from sale and rent back firms looking to make a deal."


Bank slashes interest rates

Bank slashes interest ratesThursday 9th October 2008

Many mortgage deals will become cheaper as a result of the Bank of England's interest rate cut, lenders have confirmed.

At midday yesterday, the Bank announced that it would reduce the base ratee by 0.5 percent to 4.5 percent.

The dramatic move, announced a day ahead of schedule, was mirrored by identical reductions from the Federal Reserve and the European Central Bank.

So far, Halifax and Lloyds TSB - along with Lloyds-owned Cheltenham & Gloucester - have indicated that they will pass the cut on to their standard variable rates in full.

These changes go through on November 1st.

Michael Coogan, director general of the Council of Mortgage Lenders, commented: "All this decisive action augurs well for an improving market situation looking ahead, even though no one is pretending the tough times are over yet."

Despite the Bank's cut, and the announcement of the government's £50 billion plan to recapitalise banks through the purchase of shares in them, London's flagship FTSE 100 index slid by over five per cent yesterday.

This testifies to the continuing lack of confidence in the economy's prospects of recovery.


Demand for rental accommodation soars 65%

Tuesday 23rd September 2008

Buy to let landlords are benefiting from a huge rise in demand for rental accommodation, new data has revealed, as would-be buyers increasingly opt to delay their entry in to the market.

Figures from Your Move show that the number of leases taken out during August was 65 per cent higher than it was during the same month last year.

Meanwhile, in the period between January and August, the number of people signing a rental agreement rose by 45 per cent compared with the same period in 2007.

David Newnes, managing director of Your Move, attributed the rise to lenders' reluctance to advance mortgage finance to borrowers, as well as the fact that more consumers are adopting a wait-and-see approach to the housing market. 

Mr Newnes explained: "Mortgages are hard to come by and would-be buyers are flooding the rental sector. If you can't get the finance to buy a house, you're forced to rent."

He added: "We might expect the huge increases in demand for rental property to have driven up rents. But demand is being met by supply - sellers who won’t accept depressed prices put their homes up for rent instead."

RBS Intermediary partners announce rate changes

Wednesday 17th September 2008

RBS Intermediary Partners will be introducing new rates on a number of its fixed rate and tracker mortgages from Wednesday 17 September.


  • First Active 2 year fixed rate online only (max LTV 75%) will be reduced to 5.59% (7.3% APR) from 5.79% with a £999 arrangement fee until 31 October 2010.

*For all First Active residential remortgage products there are no basic legal or valuation fees. Overpayments of up to 10% of the original balance per annum are allowed during the initial deal period.


  • RBS 2 year fixed rate (max LTV 75%) will be reduced to 5.54% (7.3% APR) from 5.74% with a £999 arrangement fee until 31 October 2010.
  • RBS 2 year tracker (max LTV 90%) will increase to 6.44% (BoE rate +1.44%) (7.5% APR) from 6.24 (BoE rate + 1.24%) with a £999 arrangement fee until 31 October 2010.

*Overpayments of up to 10% of the outstanding balance per annum are allowed during the initial deal period.


News Story

Agents call for serious interest rate cut to save market

Friday 5th September 2008

Reaction to the Bank of England’s decision to hold interest rates at 5% has gone down badly within the industry.

The decision was announced hours after the latest Halifax survey showed house prices plunging by 12.7% in a year – the fastest fall since the Depression of 1931.

With average house prices now back to March 2006, an estimated 200,000 householders are now in negative equity.

Lucian Cook, of Savills residential research, called for a serious cut in interest rates.

He also criticised this week’s package of measures designed to help the housing market, including a temporary raising of the Stamp Duty threshold to £175,000 ¬– a measure now widely thought to be of more help to property investors than first-time buyers.

He said: “Our reaction was lukewarm at best. By contrast, a serious cut in interest rates, fed through to reduced mortgage costs, would begin to address the issues which are really blighting the market.

“While we recognise that Inflationary factors make a meaningful cut unlikely in the foreseeable future, from the perspective of the housing market this is desperately needed, both to stimulate activity and ease the concerns of home owners.”


2 Sep 2008

Breaking News

Stamp Duty suspended up to £175k

Alistair Darling, the Chancellor of the Exchequer, has announced that Stamp Duty land tax will not apply to purchases of residential property of £175,000 or less.

The Government said this relief will apply to transactions with an effective date on or after 3 September and before 3 September 2009.

National reports have suggested further measures will be announced by the Communities Secretary, Hazel Blears, later today.


Friday 29th August 2008

Consumers overestimate life insurance costs

Millions of Britons are leaving themselves financially vulnerable because of the mistaken perception that life insurance is too costly, a new survey suggests.

Life insurance provider Legal & General quizzed almost 2,000 adults for its study and found that 65 per cent of the sample over-estimated the cost of taking out £150,000-worth of cover.

Meanwhile, 35 per cent over-estimated the cost of adding a critical illness option to a life insurance policy.

Karen Blatchford, commercial director for housing at the lender, said: "Life cover can start from as little as £6 per month, which even families on a very tight budget may be able to afford.

"We're concerned that two-thirds of people are over-estimating the costs of protection."

He added: "People may wish to consider covering not just their mortgage debt, but their family expenditure and bills. Most families would really struggle if there was an unexpected drop in the household income."

The study also revealed that 38 per cent of Britons have no life insurance cover in place.



Wednesday 27th August 2008

Stamp Duty dithering paralyses marketStamp Duty dithering paralyses market

An overwhelming 83% of home movers are either pushing back their moving date or postponing their entire move indefinitely, as a result of the Government's dithering over Stamp Duty.
Moveme, an online planning aid for people moving home, surveyed 1,500 people on its database.
Of these, only 17% said that the uncertainty over Stamp Duty made no difference to their plans, while 20% had deferred completion and 63% were postponing their move indefinitely.
 Charles Wasdell, director of, and who has himself deferred moving home, said: "It is plain to see the devastating effect the Government is having on the housing market, as it keeps tight lipped about the possibility of a Stamp Duty holiday.
“The Chancellor must either press ahead with the legislation immediately or confirm that there will be no Stamp Duty holiday, so the people who are buying property move ahead with their purchase.”
The survey is in line with fall-throughs reported by both the National Association of Estate Agents and Royal Institution of Chartered Surveyors.
The NAEA says that the number of fall-throughs induced by the Government’s failure to say what it is going to do with Stamp Duty can be measured in thousands.
The RICS says that new buyers in August fell by 20% more than had been expected.


Friday 22nd August 2008

Major HIP company collapses

The market slowdown has claimed another victim, Hipstar.

The HIP provider, based in Chertsey, Surrey, has gone into administration.

Callers to the company are told that a liquidator is to be appointed and that anyone with queries meanwhile should email

Hipstar also had a significant franchise operation and is believed to have sold 92 franchises last year and 31 the previous year. It was still aiming to sell more franchises this year.

The company came late to the market, launching in March 2006. It aimed to be a major provider and was geared up to doing 150,000-180,000 HIPs per year.

However, it was caught first by the delayed introduction of HIPs, followed by the collapse in residential sales.

Its parent company, AIM-listed Network Data Holdings, which continues in business and which also has
and mortgage operations, made a pre-tax loss of £1.1m last year after a profit of £0.3m the previous year. It is believed to have spent up to £5m getting Hipstar up and running.

This spring Network Data’s chief executive Richard Griffiths said that 2008 would be difficult for companies operating in the mortgage and property industries.

Hipstar is one of the largest and highest-profile of the HIP companies to become a casualty.

20 Aug 2008

Breaking News

Three-way split on base rate at the MPC

The latest minutes from the Bank of England’s Monetary Policy Committee (MPC) have revealed that for the second consecutive month there was a three-way split about what to do to Bank base rate.

Seven members of the committee voted in favour of a freeze at 5%, though David Blanchflower continued his long call for a cut by voting for a reduction of 25 basis points, while Tim Besley advocated an increase of 25 basis points.

The minutes note that Besley argued: “Although there were considerable downside risks to growth, particularly those arising from the tightening of credit conditions, a pre-emptive increase in Bank rate would help to keep inflation expectations anchored to the target and lessen the need for more restrictive policy in the future.”


15 Aug 2008

Breaking News

Halifax cuts rates by up to 0.45%

Halifax is cutting rates on some of its introduced mortgage products by up to 0.45%, and is set to introduce four new fee-free products from Saturday 16 August.

The new rates include a two-year tracker at 5.59%, down from 5.69%, up to 75% LTV with a £1,999 fee and a three-year fixed rate at 6.04%, down from 6.49%, up to 75% LTV and with a £499 fee.

The new fee-free products include a three-year tracker rate at 6.19%, up to 60% LTV, and a two-year fixed rate at 6.39%, up to 60% LTV, both available for homebuyer and remortgage customers.

Thursday 14th August 2008

Millions of Britons are doing without life insurance, despite a sustained fall in the price of the cover.

Research conducted by the Post Office found that around 75 per cent of adults in the UK do not have a life insurance policy.

Among the principal reasons given for not taking out cover was that the premiums are too expensive - a factor cited by 28 per cent of those quizzed.

This is in spite of the fact that the cost of life insurance has fallen by 70 per cent over the last 30 years.

Post Office head of protection, Duncan Caesar-Gordon said: "Thinking about the future and how the family will cope should the unexpected happen is a worry that can be easily avoided by taking out life insurance.

"With a typical cost of £10 per month people would have peace of mind knowing that their loved ones are protected."

The survey also revealed that 18 per cent of people had not taken out cover on the grounds that they deemed their lives not worthy of insuring.

Monday 11th August 2008

The Association of Home Information Pack Providers (AHIPP) has moved to defend Home Information Packs (Hips) from widespread criticism, claiming that they deliver "real benefits to home buyers and sellers".

Since the introduction of Hips their worth has been repeatedly questioned, with estate agents this week reiterating claims that the extra expense of securing one is dissuading people from marketing their homes and contributing to the market slowdown.

However, Paul Broadhead, deputy director general of AHIPP, has refuted the criticism and said that there were a number of discernable positive effects that the packs have had.

He commented: "Even in their present incomplete form Hips are already having a positive impact on the market. Consumers are benefiting from faster transactions, reduced stress, cheaper searches and better protection.

"With more consumer friendly information in packs from the beginning of next year along with the ending of estate agents marketing homes without packs, the benefits will be increasingly obvious for all to see. I believe the government should now go even further."

AHIPP claims that since Hips were introduced the time taken to exchange contracts has fallen to 12 days.

 7 Aug 2008

Breaking News


MPC votes to hold rates


The Bank of England’s (BoE)Monetary Policy Committee (MPC) has voted to hold the Bank base rate at 5%.

The BoE was widely expected to hold the rate by the majority of industry commentators.

The last change was a reduction of 0.25% to 5% on 10 April.


Thursday 31st July 2008

The cost of fixed-rate deals is falling, offering a "glimmer of hope" to borrowers amid the downturn in the housing marker, according to Moneyfacts.

Research conducted by the personal finance site showed that the average cost of a two-year fixed rate as of July 11th was 7.08 per cent.

However, since this time the fall in swap rates, which are used by lenders to set rates for fixes, the average rate has fallen to 6.95 per cent.

The cost of the deals has been brought down after a number of mainstream lenders have announced cuts to rates recently. 

Darren Cook, mortgage expert at the site, commented: "There is a faint glimmer of hope the fixed-rate mortgage market is returning to some sort of normality."

Stamp of approval as discussions held to relieve housing crisis

Wednesday 23rd July 2008

It was announced this week that the government are considering suspensions to the existing Stamp Duty levels in order to help First Time Buyers and those at the lower end of the property scale through the credit crisis. The current financial landscape has seen a phenomenal reduction in the amount of approved mortgages and loans, with lenders stalling over passing on the reductions in interest rates as quickly as they passed on the increases; it is an extremely worrying time for borrowers.

Indeed, as reported by, the loans sector is faring no better, with two, three and five year fixed rate best buys are now occupied by deals over 6%. Whilst there are still sub 6% deals available, the fees attached do not qualify them as a best buy; however, the average rate for a three year fixed deal currently stands at a record 7.25%.

An official government spokesperson stated that talks were being held to find a way to relieve the burden felt by the current financial state as a whole, and to boost the property market. Currently all homes above £125,000 are required to pay Stamp Duty, but in a move similar to that which the Conservatives took in 1992 when they raised the threshold to £250,000 The official told the Daily Mail that the government is being “exercised about the housing market and they are looking at a lot of different measures.”

The housing minister, Caroline Flint and the Royal Institution of Chartered Surveyors were in discussion over how best to move forward.



Banks have to stop ripping off customers if pressures of credit crunch are to ease

Thursday 3rd July 2008

Darling has warned banks that they need to stop ripping off their customers during the hardships of the Credit Crunch.

The Chancellor stated that he was aware that some banks were upping mortgage arrangement fees. The average fee for a fixed rate mortgage deal is now £860 having gone up 66 per cent in the last 18 months. Times are difficult enough for consumers and mortgage intermediaries without lenders increasing fees.

Mortgage approvals are falling and banks will have to be more lenient with fees if the housing market is to turn around soon. Many mortgage lenders are also hitting consumers by administering set up fees which are often 2 per cent of the amount being borrowed.



Friday 27th June 2008

Darling has warned banks that they need to stop ripping off their customers during the hardships of the credit crunch.

The Chancellor stated that he was aware that some banks were upping mortgage arrangement fees. The average fee for a fixed rate mortgage deal is now £860 having gone up 66 per cent in the last 18 months. Times are difficult enough for consumers and mortgage intermediaries without lenders increasing fees.

Mortgage approvals are falling and banks will have to be more lenient with fees if the housing market is to turn around soon. Many mortgage lenders are also hitting consumers by administering set up fees which are often 2 per cent of the amount being borrowed.


Tuesday 24th June 2008

The number of property transactions fell during May, as tighter lending conditions and a wait and see approach from potential buyers caused activity to stagnate.

According to data from HM Revenue & Customs (HMRC), there were 110,000 completed property transactions during the month.

This represents a fall of five per cent from April when the figure had stood at 115,000.

During May last year, some 158,000 property transactions had been enacted, meaning that activity has fallen by 37 per cent year on year.

Levels of transactions are now at the lowest level recorded since the HMRC began compiling its property sector information in 2005 and according to the Independent, activity is now thought to be at its slowest since the mid-1990s.

Simon Rubinsohn, chief economist at the Royal Institution of Chartered Surveyors (Rics) said: "These numbers clearly highlight the very real pressure on the residential property market.

"Indeed, Rics suspects that the level of activity will fall further over the coming months."