London Property Finder

News emerged yesterday, 7th December, that HSBC is to make available £15billion for mortgages in 2009.  This equates to a 20%  increase in lending compared to 2008 and almost double the amount it loaned in mortgages in 2007.   In addition HSBC plans an extra £1billion of funding for small businesses.  Annecdotally, we understand from a branch manager that HSBC have closed their books for development finance, but they are open to strong evidence backed proposals from small businesses.  According to The Times, the Federation of Small Businesses (FSB) has ‘singled out Barclays for failing to produce measures to help small businesses since the start of the credit crisis’.

One company cannot bail out the housing market but this is a step in the right direction.  HSBC has a track record of being one of the first to react to interest rate fluctuations and changes in government policy.  As a result of its lower exposure to the sub prime mortgage market, it is in a good position to increase its trading position in  UK mortgage lending.  Let us hope that other banks follow suit!  When you have the finance then cobntct the London Property Finder for a swift move.

Technorati Tags: London Property Finder, Mortgage Lending, Small business loans

Tags: London Property Finder, Mortgage Lending, Small business loans

Musings of a London Property Finder

The Halifax issued data from it’s house price index yesterday including the news that housing affordability is at it’s most favourable for five years.  The house price to earnings ratio has fallen by 22% in recent months from a peak of 5.84 in July 2007 to an estimated 4.56% in November 2008 reaching a level not seen since the end of 2003.  Affordability is now only 0.56% above the long-term average of 4.0%. 

The most significant drop in the price to earnings ratio can be seen in Greater London where property is significantly more affordable than it was at the peak of the market in July 2007.  Property prices have fallen but wages generally remain static thus far. 

Martin Ellis, Chief Economist at the Halifax commented:

” There was a 2.6% decline in average UK house prices in November.  The combination of high house prices in relation to earnings, constraints on householders’ incomes and spending power and the decline in the availability of mortgage finance since the summer of 2007 has curbed housing demand.  These factors are major contributors to lower house prices and activity.”

House prices have tumbled 10-15% on average in the UK so housing affordability has also dropped.  Deflation and falling oil and food prices plus the lowering of interest rates will start to affect consumer finances.  So the only thing remaining to fix, is credit availability and confidence.  However, until banks start lending and first time buyers can buy at affordable rates with 90% mortgages again, as was possible during the last recession, it’s difficult to see when the slack housing market will start moving. 

Thank goodness for those with good credit ratings or no need for mortgages – they are keeping us London Property Finders and Relocation Agents busy these days.

http://www.hbosplc.com/economy/HousingResearch.asp

Technorati Tags: Credit availability, Halifax house price index, house price index, House price to earnings ratio, Housing affordability, London House Prices, London property affordability, London Property Finder, UK house prices

Tags: Credit availability, Halifax house price index, house price index, House price to earnings ratio, Housing affordability, London House Prices, London property affordability, London Property Finder, UK house prices

Musings of a London Property Search Agent

The latest interest rate cut announced today by the Bank of England (BoE) means great news for homeowners with BoE variable rate tracker mortgages.  Variable rate mortgages based on the Bank of England base rate have been cut drastically in the last 3 months as the Bank of England base rate tumbled from 5% in September 2008 to just 2% from today. 

Mortgage lenders generally take a few months to pass on the rate but as from the early part of next year, many borrowers should see significant savings in their mortgage payments.  The table below provides an idea of the savings on a typical 25 year term BoE base rate tracker mortgage on a capital and interest basis, excluding fees and where the lender passes on the full 3% base rate cut to the borrower.  Not everyone will benefit however, as many mortgages have a collar below which base rate cuts are not passed on.

Clearly the most significant savings are for those on large variable rate mortgages which is great news for our Clients as like many London Property Finders and Relocation Agents working in the mid to top end, a significant proportion of our clients will be saving upwards of £500 a month.

All figures supplied by Piero Mazzoni of The Porchester Group Limited.  You can contact him for mortgage advice on 020 7529 1980 or email him Piero.Mazzoni@porchestergroup.co.uk

http://www.porchestergroup.co.uk/site/home/

This summary is for general information only and is not intended to be advice to any specific person. You are recommended to seek competent professional advice before taking or refraining from taking action on the basis of the contents of this summary. The summary represents our understanding of the law and Bank of England base rates as at 4th December 2008, which are subject to change on a monthly basis. All mortgages are subject to status and to suitable security.  If you are ready to buy contact the London Property Search Agent

Technorati Tags: Bank of England Base Rate, Bank of England Interest Rate Cuts, Interest Rate Cuts, London Property Search Agent, Mortgage Interest, Reduction in Mortgage Repayments

Tags: Bank of England Base Rate, Bank of England Interest Rate Cuts, Interest Rate Cuts, London Property Search Agent, Mortgage Interest, Reduction in Mortgage Repayments