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| NAEA Says There Are Still Regional Differences - 02-05-2008 |
Following the release of the Halifax house price index today, Peter Bolton King, Chief Executive of the National Association of Estate Agents (NAEA), the residential sales arm of the National Federation of Property Professionals (NFOPP), said:
Whilst the report shows a modest decline in prices, this is a small proportion of the substantial prices in recent years. And the picture is still regional with some areas holding up better than others. In fact, the report shows that Scotland is going to show a modest rise this year. This is in line with recent research that shows that the Scottish market could grow 1% in 2008*.
There is no denying that the credit crunch has affected confidence in the market but it is still important to remember that the underlying factors that support the property market remain: low unemployment, historically low interest rates and a pent-up demand for houses. Therefore, rather than a dramatic fall that some doom and gloom merchants are predicting, it shows we are looking at a return to a more steady market rather than the fantastic price hikes we have seen in the previous 10 years.
Editor Notes:
*Knight Franks Scottish Residential Review 2008
About the NAEA
The National Association of Estate Agents (NAEA), the residential sales arm of the National Federation of Property Professionals (NFOPP), is the UKs leading professional body for estate agency personnel, representing the interests of around 10,000 members who practice across all aspects of property services both in the UK and overseas. These include residential and commercial sales and lettings, property management, business transfer, auctioneering and land.
The National Association of Estate Agents is dedicated to the goal of professionalism within all aspects of property, estate agency and land. Its aim is to reassure the general public that by appointing an NAEA member to represent them they will receive in return the highest level of integrity and service in both sales and lettings, for all property matters. Each NAEA member is bound by a vigorously enforced Code of Practice and adheres to professional Rules of Conduct. Failure to do so can result in heavy financial penalties and possible expulsion from the Association.
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| Naea Welcomes Bank Of Englands Views For The Future - 01-05-2008 |
The National Association of Estate Agents (NAEA), the residential sales arm of the National Federation of Property Professionals (NFOPP), welcomes the news announced today in the Bank of Englands financial stability report that predicts a resurgence in confidence over the coming months.
Peter Bolton King, Chief Executive, NAEA, comments: It should certainly come as a great boost to consumer confidence to hear this news from the Bank of England. There has been much doom and gloom reported over the past few months, especially with regards to the global credit crunch. However, to hear that there is light at the end of the tunnel should come as a massive boost to consumer confidence and is the crutch that both consumers and organisations very much need.
As an Association, we have always been keen to stress that what the market place is experiencing at present is not anywhere near the difficulties seen in the late 1980s/early 1990s and it is encouraging to see this fact advocated in the report.
However, in order for consumer confidence to be nurtured over the coming months it is critical for the Bank of England to further reduce interest rates this month in order to help bolster consumer confidence even further.
It remains paramount that the shackles currently around the mortgage market are loosened and it is imperitative that the lendors pass on these interest rate reductions to consumers to help lighten the load.
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| Nationwide report House Prices Fall - 30-04-2008 |
According to Nationwide, house prices in the UK have recorded their first annual fall for 12 years. Prices fell by 1.1% in April, the sixth monthly decline in a row, and were down 1% from the levels seen in April 2007, the building society said. An average home now costs £178,555 which is £1,759 lower than April 2007.
Fionnuala Earley, chief economist at Nationwide, explained: There has been a steep decline in house buying in the last six months owing to falling demand from first-time buyers, higher mortgage rates and tighter lending criteria.
The rise in unsold property on the market has improved the bargaining power of buyers which has, in turn, pushed down prices. This is likely to have a knock-on effect on the wider economy, with consumers becoming more cautious.
Ms Earley dismissed suggestions that the current slump was similar to housing crash of the early 1990s: The current housing market is very different to the situation in the late 1980s and early 1990s, and the underlying conditions for most mortgage borrowers are more positive than some would suggest. Indeed, unlike the 1990s crash, more people are on fixed-rate than variable-rate mortgage deals and this helps the stability of the market.
The fundamental factors that affect the Housing Market are still strong and there fore prices may only fall about 5% this year on average. It will also be interesting to see what happens to the supply of mortgages when the £50 billion released by the Bank of England works its way into the system.
Not as bad as it seems?
Peter Bolton King, Chief Executive of the National Association of Estate Agents (NAEA), commented: This needs to be put into context. We have been experiencing huge price leaps in the housing market in recent years so overall, a 1% drop is a tiny proportion of the rise and certainly not enough to throw many people into negative equity the way we saw it in the early 90s.
In addition, a national picture can only tell a bit of the story. We can see from other surveys that the picture is mixed across the country and some areas will be more affected than others, so people really need to look to their local markets to get a true picture.
There is no denying that the credit crunch has affected confidence in the market but it is still important to remember that the underlying factors that support the property market remain: low unemployment, historically low interest rates and a pent-up demand for houses.
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| NAEA Calls For Calm Over Nationwide Report - 30-04-2008 |
Following the release of the Nationwide report today Peter Bolton King, Chief Executive of the National Association of Estate Agents (NAEA), the residential sales arm of the National Federation of Property Professionals (NFOPP) said:
This needs to be put into context. We have been experiencing huge price leaps of double percentage points in the housing market in recent years so overall a 1% drop is a tiny proportion of the rise and certainly not enough to throw many people into negative equity the way we saw it in the early 90s. In addition, a national picture can only tell a bit of the story. We can see from other surveys that the picture is mixed across the country and some areas will be more affected than others, so people really need to look to their local markets to get a true picture.
There is no denying that the credit crunch has affected confidence in the market but it is still important to remember that the underlying factors that support the property market remain: low unemployment, historically low interest rates and a pent-up demand for houses.
- Ends -
Editor Notes:
About the NAEA
The National Association of Estate Agents (NAEA), the residential sales arm of the National Federation of Property Professionals (NFOPP), is the UKs leading professional body for estate agency personnel, representing the interests of around 10,000 members who practice across all aspects of property services both in the UK and overseas. These include residential and commercial sales and lettings, property management, business transfer, auctioneering and land.
The National Association of Estate Agents is dedicated to the goal of professionalism within all aspects of property, estate agency and land. Its aim is to reassure the general public that by appointing an NAEA member to represent them they will receive in return the highest level of integrity and service in both sales and lettings, for all property matters. Each NAEA member is bound by a vigorously enforced Code of Practice and adheres to professional Rules of Conduct. Failure to do so can result in heavy financial penalties and possible expulsion from the Association.
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| RICS: Big price crash ‘unlikely’ - 15-04-2008 |
The RICS is upbeat despite record numbers of surveyors reporting price falls in March…
In March, almost 80% of Surveyors reported house price falls, which represents the worst set of figures since RICS began the survey in 1978. The RICS house price balance dropped for the eighth consecutive month, exceeding the previously lowest reading in June 1990. The results come after leading mortgage lenders offered similarly downbeat views on property prices.
RICS spokesman Jeremy Leaf, commented: The next six months will be crucial for homeowners and would-be buyers in the UK. The gloom is the result of the credit crunch and its effect in stopping mortgage providers lending to each other.
Sentiment is at a very low ebb and will continue to remain depressed while the economy suffers from this unique liquidity blight. A significant crash in prices remained unlikely though, and buyers with access to large deposits have the chance to get their hands on property they could not previously aspire to.
Many would-be buyers are either struggling to raise the necessary finance to precipitate a move or are exercising caution in the light of current economic uncertainty.
Economic fundamentals still strong
Peter Bolton King, Chief Executive of the National Association of Estate Agents (NAEA) called for steadiness amongst property market professionals and said that there are still strong economic factors underpinning the market that have not changed and that there is some good news.
The positive news is that the RICS survey showed that just under a quarter of its respondents appear to have reported a rise in house prices, which shows how regionalised the picture is. We are already aware from our own members that house prices are being affected differently throughout the country so to find such regional discrepancies comes as no surprise.
The market is battling with the credit crunch, which has undoubtedly had an effect on confidence. However, the key factors that underpin the housing market still exist – low unemployment, historically low interest rates and a pent-up demand for houses. We can see from the figures that it is not all doom and gloom out there and we need to tread very, very carefully before making long-term judgements on the market at this current, unsettled, time.
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| Specialist Mortgage Advice Needed - 14-04-2008 |
Home buyers will need to seek the advice of a specialist Mortgage Broker to obtain a mortgage following a gloomy report from the CML
In a speech at the CMLs annual lunch, Chairman Steven Crawshaw said: I have a sense of shock at how deeply our successful industry has already been hit by these unprecedented funding market conditions. Potential borrowing still significantly exceeds the industrys collective capacity to supply funds.
Lenders were now facing real constraints on collective access to funds, and if no extra funding comes from the Bank of England, Mortgage funding could be cut by half in 2008.
It is therefore a real possibility, looking forward from today, that net lending in 2008 could reach only half last years level unless additional funds become available. But it doesnt have to be that way.
Without attracting new funding sources, we will see an ongoing process of attrition in mortgage choice, possibly over a protracted period, with lenders managing down demand by tightening lending criteria, increasing price, or withdrawing more products from the market altogether
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| Yields increase but buy-to-let mortgages dry up - 20-03-2008 |
RICS residential lettings survey Q4 2007
Demand for rental properties continued to grow as landlords saw their yields increase says the RICS Lettings Survey.
However, access to the buy-to-let market became harder for would-be-landlords as mortgage products became scarce.
16% more Chartered Surveyors reported a rise than a fall in tenant lettings, down from 20% in the last quarter.
Significantly, demand for family homes still remains stronger than for flats due to an oversupply of new build.
23% more Chartered Surveyors reported a rise than a fall in demand for houses compared to 12% Chartered Surveyors who reported a rise in demand for flats, down from 15% last quarter.
New landlord instructions (an indicator of supply) declined for the first time in the surveys history (1998).
1% more Chartered Surveyors reported a fall than a rise in landlord instructions compared to 11% in the previous quarter.
The credit crunch has restricted the number of buy-to-let mortgages approved as well as the number of mortgages available to investors.
However, established investors are reaping the benefits. Gross yields increased at their fastest pace since Q3 2005.
Rising yields may have stopped the recent retreat of landlords from the market.
The percentage of landlords selling their properties when tenant leases expire fell from 6.5% to 4.6%.
Rental expectations also picked up sharply and are more than double the surveys long run average.
Key areas enjoying rental growth also picked up sharply in the North, South East and Midlands while London and the South West experienced moderate rises.
RICS spokesperson Barry Hall commented:
While banks remain cautious about offering loans, demand for rental property will continue to increase with many would-be-buyers unable to make the jump to home ownership.
Established investors continue to reap the benefits of the current uncertainty in the housing market and have been enjoying the fruits of rising rents, but new investors are struggling to get the necessary finance to enjoy this buoyant sector.
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| Budget boost for FTBs - 17-03-2008 |
The widely derided Budget could actually help thousand of FTBs onto the property ladder, claims the DCLG&
The Chancellor announced that from April this year two new equity loans will be available through the Governments shared equity scheme Open Market HomeBuy (OMHB). The loans allow buyers to shop around for the best mortgage deals and are simpler to arrange than previous OMHB products.
Until now OMHB loans could only be taken out in chunks of 32.5%, 25%, or for the Government only loan, an average of 17.5% of the property value. The loans were also restricted to just one specific mortgage from each of the three lenders providing the loans.
This has now ended with more flexibility in the percentage of the value of their home that can be borrowed - to a maximum of 50% - and more choice in the mortgage buyers take out.
This means a household with an income of £32,000 could afford a house of £200,000, paying £760 each month - as opposed to £1,350 without the scheme.
Increased affordability
Housing and Planning Minister Caroline Flint said: We have already helped more than 95,000 households onto the housing ladder since 1997 through our low cost home ownership schemes. These new products will help us do even more. Not only will the new loans increase affordability for key workers and first time buyers, they are a lot more flexible, allowing buyers to shop around for the best mortgage deals.
The new products are:
MyChoiceHomeBuy - an equity loan of between 15% and 50% of purchase price - provided in partnership with a consortium of eight Housing Associations named CHASE - which can be used in conjunction with any conventional mortgage.
Ownhome - an equity loan of between 20% and 40% of purchase price - provided in partnership with the Housing Association Places for People and Cooperative Financial Services - which can be used in conjunction with any conventional mortgage from the Co-operative Bank.
Both loans are open to social tenants, key workers and qualifying first-time buyers. They can be used alongside a deposit and be repaid early - in part or in full - or when the property is sold.
The new products will be available from Housing Corporation HomeBuy agents from April 1 and will replace the existing Open Market HomeBuy products.
MyChoiceHomeBuy is funded 50% by CHASE and 50% by Government. Ownhome is funded 52% by Places for People and 48% by Government.
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