It is now cheaper to buy a home than to rent property in most of the UK, research has revealed.

Property website Zoopla.co.uk found that renting costs an average of 10.5% more than paying interest on a mortgage for the same type of property.

Low interest rates and falling house prices mean people are better off buying a two-bedroom flat than renting one in eight out of ten towns and cities in Great Britain.

Rents exceeded the cost of having a mortgage by more than 20% in 14 of the largest towns and cities in Great Britain.

Milton Keynes recorded the biggest difference. There, it costs 42% more to rent a home rather than buy one, with rents on a two-bedroom flat averaging £785 a month, while an interest-only mortgage on a similar property would be £554.

However, mortgage supply issues mean many people simply cannot borrow sufficient money to buy their own home – and this is behind the increased demand for rented accommodation.

Therefore we at Humberstones Homes in Quinton have launched a service aimed at buyers, whether they are looking to buy a property in our local area of Quinton, Halesowen, Oldbury and surrounding areas, or further afield. We have launched this as “FREE & EASY”, and will help buyers in negotiatiog the price with the other agent, helping them find a local solicitor, arranging their mortgage & insurances, talking them through their valuation/survey and providing details of local removal companies.

This service is available free of charge only when arranging & completing their mortgage through our preferred mortgage advisor who is independent and works for himself. What a buyer must ask themselves is whether their bank or other mortgage advisors will guide them through the whole process…. if not then we are the best people to help on 0121 678 7788.

I have attached our “Free & Easy” flyer to this article and the service will be promoted over the coming months in the Halesowen News, Express & Star, Halesowen Chronicle, Sandwell Chronicle and the Birmingham Mail.free and easy

The buy-to-let market grew by 7% in 2010, according to the latest data from the Council of Mortgage Lenders.

At the end of the year there were an estimated 1.3 million buy-to-let mortgages outstanding, worth £152billion, accounting for 12% of the total value (11.5% by number) of mortgages outstanding.

The total value of buy-to-let lending in 2010 was £10.4billion (22% higher than in 2009), and the total number of loans advanced in the year was 102,000 (10% higher than the previous year).

In the fourth quarter of 2010 there were 28,600 new buy-to-let loans advanced, worth £3billion. This was a rise of 6% by volume and 7% by value from the third quarter.

In terms of loan performance, the buy-to-let sector has seen a further improvement in the number of mortgages in arrears.

While direct comparisons with the owner-occupied sector are difficult because of the additional option of appointing a “receiver of rent” on a buy-to-let loan, the general picture is that the share of arrears cases accounted for by buy-to-let loans is now only just over the overall buy-to-let share of the mortgage stock, having previously been notably higher than the owner-occupied sector.

Low interest rates are a key driver of this narrowing of the gap, since the largely interest-only buy-to-let sector gains greater benefit from lower interest payments than the predominantly capital-and-interest owner-occupied sector.

Looking ahead to the prospects for the buy-to-let sector in 2011, the CML expects strong rental demand to remain, driven not least by the continuing deposit constraints to entry to the owner-occupier market.

CML director general Michael Coogan said: “Funding remains a key constraint on growth in buy-to-let lending, but demand seems to be resilient and loan performance has improved. Looking ahead, loan performance could potentially be adversely affected by rising rent arrears or interest rate rises, but at present there is no indication of these pressures materialising in practice.

“There is also a strong counterbalancing growth influence on the buy-to-let market, as tenant demand seems set to remain high in the face of continuing deposit constraints to entering the owner-occupier market.”

Whilst the market is hard what we are finding here at Humberstones Homes in Quinton, is that if a property price is attractive enough there are plenty of buyers that will be interested and have the funding to proceed succesfully to completion of the sale/purchase.

The first article follows here:

Turbulence and uncertainty could be set to hold back the housing market for some time yet, agents are being warned.

After recording year-on-year growth of 6.4% in 2010, the housing market recovery will stall in 2011, leaving house prices 1.7% lower compared to last year – according to the latest forecast from the Centre for Economics and Business Research.

Anaemic growth in disposable incomes and higher unemployment throughout 2011 will cause house prices to fall, particularly in regions most vulnerable to public sector cuts.

However, affordability for first-time buyers will reach an eight-year high in 2011 as mortgage interest rates remain at record lows and house price growth weakens.

The Cebr said it expected the ongoing fragility of the recovery to dampen demand for mortgage lending, as households continued to repay debts and rebuild savings.

House price growth will resume at a slow pace from 2012 onwards as banks’ lending criteria are relaxed further and consumer confidence recovers from a year of rising inflation and uncertain employment prospects.

Shehan Mohamed, the report’s author and economist at Cebr said: “We expect to see household earning power suffer over the next year or so, due to higher inflation and weaker employment prospects as the economic recovery remains fragile.

“Lower consumer confidence throughout the year is expected to rein in demand for mortgages, which will average around 50,000 per month – still around 50% lower than pre-credit crunch levels.

“The Bank of England’s loose monetary policy stance in the face of the impending public sector cuts will keep mortgage rates anchored. Indeed, affordability for first-time buyers will reach an eight-year high this year, with first-time buyers spending an average of 24.2% of their disposable incomes on mortgage payments.”

Cebr Chief Executive Douglas McWilliams said: “We expect house prices to grow tentatively over the coming years, given that household incomes are being squeezed and banks are still wary of lending. There is currently significant uncertainty in the market caused by the Government’s spending cuts and a choppy recovery, which has greatly impacted transaction levels.”

But young people are often unable to take their first step on the property ladder and the average age of an unassisted first-time buyer is now 37.

Almost two-thirds (65%) of people under the age of 30 believe that they cannot afford to buy a home as big as the one in which their parents lived at the same age. This figure rises to 75% in the South East.

Young adults increasingly resent the housing wealth acquired by the over-40s.

Some 44% of respondents aged between 18 and 29 describe the housing wealth which the generation over 40 has accumulated because of rising house prices as “unfair”. By contrast, only 10% of respondents aged between 40 and 65 agreed.

People under the age of 30 are more opposed than any other age group to “Continental” models of tenure in which families routinely rent for the duration of their adult lives.

Some 90% of respondents aged between 18 and 29 would not be happy if they had to live in rented accommodation for the rest of their working lives. While 64% say that they would not be happy to start a family while they were renting and 43% would not be happy to get married until they owned their own home.

Mark Clare, Chief Executive of Barratt Developments, said: “The findings from this nationwide poll illustrate the extent of the housing crisis facing Britain and the depth of the public policy challenges we now have to tackle as a result.

“Signs of friction between the generations are now starting to emerge as a direct consequence of relative housing wealth. Significant numbers of people – especially those under the age of 30 – appear to be delaying key life decisions such as starting a family because they cannot take that all-important first step on the housing ladder.

“Because home ownership is becoming more not less difficult, it is likely that these problems will become still more acute in the decade ahead.”

Record number of instructions in our area including Quinton, Halesowen, Oldbury and Romsley – more houses, bunglaows and flats to sell in Spring.

We also agreed more sales than in January 2010 which maybe partly down to a lack of snow this year but most importantly a more stable property market and economy – no elections etc this year!

If you would like more information on selling your home or in fact are looking to buy then please have a look on our website www.humberstoneshomes.co.uk or call Ian or Adam on 0121 678 7788.

Here is the article:

The percentages might change with each different set of statistics but the general trend of the UK property sales market remains in negative territory.

Figures from housing intelligence firm Hometrack found that house prices have fallen for the seventh month in a row.

Most NAEA members would likely concur that both buyers and sellers were in short supply last month as the average cost of a home in England and Wales dropped by 0.5% to stand at £153,600.

That figure is 2.2% less than in January 2010.

Hometrack’s research found a slowdown in both supply (-5.4%) – the largest monthly fall for four years – and demand (-9.5%).

Falling demand in particular is likely to impact on pricing levels over the first half of 2011.

In January 2010 demand stood at -2.7%, a sharp contrast to today’s figure of -9.5%. This suggests that the housing market is facing more fundamental underlying issues than the usual post-Christmas slowdown.

With recent rises in the cost of living, household budgets will only come under further strain if concerns over rising inflation translate into higher interest rates. Mounting concern over a possible interest rate rise will act as a further dampener on demand.

Hometrack said the supply of homes for sale was likely to dwindle further over the next two quarters.

Hometrack director of research Richard Donnell said: “There are no signs of a New Year bounce for the housing market, as 2011 begins with a sluggish start.

“The supply of new homes coming to the market continues to fall but it is the change in demand that we need to pay most attention to, as this will have the greatest impact on pricing levels in the first half of 2011.

“Concerns over the economic outlook and the biting reality of spending cuts are doing little to improve a fragile market defined by weak consumer sentiment and a lack of demand for housing.”

Green Deal to boost jobs

The Coalition is planning to create 100,000 jobs insulating homes by 2015.
 
Chris Huhne, Energy and Climate Change Secretary, announced the plan as part of a national effort to make homes warmer and cheaper to run.

Currently around 27,000 people work in the insulation industry.

Legislation to start the process of establishing the Green Deal is due to be introduced into Parliament next month. But the work will not get under way for another two years.

The Green Deal is the Government’s scheme to make energy efficiency available to home owners and tenants. The work to upgrade properties will be repaid from the savings on energy bills.

Huhne said: “I want Britain to say goodbye forever to leaky lofts and chilly draughts. At a time of increasing gas prices, energy efficiency is a no-brainer.

“It’s also a massive economic and job opportunity which could help Britain’s economy turn the corner. With up to 100,000 green jobs up for grabs over the next five years, and even more in the long term, this is about growing our economy in a way that’s good for jobs, the environment and energy security.”

The Green Deal, which is expected to be available from Autumn 2012, will be open to homes and businesses and will involve a three-stage process:

1 An independent energy survey of the property, giving clear advice on the best energy efficiency options, such as loft or cavity wall insulation.

2 Green Deal finance to be provided by a range of accredited providers, which will be repaid through savings on energy bills, making properties cheaper to run from day one.

3 Homes and businesses will then receive their energy efficiency package. Only accredited measures will be installed by appropriately-qualified installers, overseen by the Government, giving consumers confidence that the deal they are getting is high quality and will save them money.

Landlords will face no upfront costs when improving their properties. The forthcoming Energy Bill will create powers allowing any tenant asking for reasonable energy efficiency improvements to receive them from 2015 onwards.

It will also allow local authorities to insist that landlords improve the worst-performing homes.

In the run-up to the Green Deal, 3.5 million more homes across Great Britain are likely to benefit from insulation by 2012 as part of changes to the obligation on energy suppliers announced in June. As part of the changes, 15% of homes helped will be the lowest income households more at risk of fuel poverty.
 
The Coalition says it wants the Green Deal to apply to the whole of Britain and it is talking with colleagues in Scotland and Wales about this opportunity.

Further information about the Energy Security and Green Economy Bill can be found at: www.decc.gov.uk/en/content/cms/legislation/energy_bill/energy_bill.aspx

It is estimated that there are 14 million insulation measures like loft, cavity and solid wall to be carried out in Britain’s homes. If all 26 million households were to take up the Green Deal over the next 20 years, employment in the sector would rise from its current level of 27,000 to something approaching 250,000.

Wanted: ‘boring’ housing market

Lynda Blackwell, mortgage policy manager at the Financial Services Authority, has called for a ‘boring’ and ‘predictable’ housing market.

In a speech at the Building Societies Association’s annual mortgage seminar entitled ‘The future landscape for mortgage regulation’, she said the FSA agrees with housing minister Grant Shapps’ recent comments when he said we need a ‘boring’ and ‘predictable’ housing market.

Ms Blackwell said that during the boom period 1997 to 2007, there was actually an overall reduction of almost 160,000 in the number of households with a mortgage.  

By contrast, mortgage debt rose by 200% in the same period, partly due to increased investment in buy-to-let and remortgaging.

In countries where lending restrictions were not eased as much as in the UK during the ‘boom’ years such as Canada and Australia, they have not seen as many repossessions.

The FSA believes that the stricter affordability checks will have the effect of encouraging consumers to consider their ability to repay the mortgage more carefully and make them more responsible. Borrowers will no longer be able to self-declare income and will have to convince a lender that their stated income is indeed real.

Consumers will also have to think through their budget to provide information to help the lender properly understand their income and outgoings.

She said the FSA has decided against imposing strict loan-to-value thresholds because of the potential impact on consumers. Other decisions on lending restrictions will be included in a consultation paper this month.