Musings of a London Property Search Agent

The government’s announcement today of an increase in the minimum stamp duty threshold to £175,000 will inevitably help wannabe home-owners step onto the property ladder.  But one of the main problems is the media and the gloom-mongers.  Increasingly first time buyers are lacking the confidence to buy, as they wait for the bottom of the market – aka till prices start to rise and they have to downgrade by a bedroom.

This move and the other moves announced today, including decreasing the time period before housing benefit can be claimed against mortgage payments will affect our Clients.  But we think they will be effective in deprived areas of London and outside the South East.

A plethora of pundits have pored scorn on the government’s proposals today but really, is increasing national debt for the benefit of some of the projected 45,000 or even 55,000 repossessions going to help anyone in the long-term?  We approve particularly of the reduction (by a third no less) of the time limit before Income Support for mortgage interest is paid and also the extension of powers to Housing Associations to purchase from home-owners in distress.

Both measures will help people in dire straits who are likely to be able to reverse their fortunes.  It only takes illness, redundancy and a lack of insurance to plunge hard-working home-owners into the red.  Hopefully these measures will prove a lifeline.  Neither are new – both were used in the late 80s and early 90s.  Fortunately to date, none of our clients have fallen into this category but we cannot speak for other Proerty Search Agents.

But the best advice for readers is to be fully insured.  We don’t EVER make money for recommending income and mortgage protection insurance, or anything else for that matter.  But if you couldn’t make your mortgage payments if you were to become ill or made redundant, then make the investment and take out insurance before it’s too late.  If you need a good broker, then call us and we will get London’s finest to call you.  For free. Because we’re nice like that.

But the market is lacking confidence at the moment which is what is causing the problem.  The government could amend the stamp duty thresholds further up the chain – that would seem reasonable in the circumstances, particularly as many London first time buyers we see fall into the £250K – £550K bracket and these are the very people who will prop up the market from the bottom of the food-chain.  But that is a London-centric solution affecting only part of the market.

Most people in London are still quids in unless they bought very recently and/or very badly.  We will do everything in our power to prevent our Clients making bad decisions but at the end of the day, responsibility ends with the individual.  Equally we know it is possible to make money out of property and move up and avoid paying off your mortgage for more than ten years, but at the end of the day, it’s your home, your castle.  As long as you can afford your mortgage payments, get on with your life.  The market will improve again.  Trust me, you’re in London or the South East and these London Property Search Agents know the market.

Technorati Tags: London Properrty Search Agents, Redundancy, Repossessions, Stamp Duty Relief

Tags: London Properrty Search Agents, Redundancy, Repossessions, Stamp Duty Relief

London Property Finder

Average house prices have increased by 1.5pts and 0.1pts respectively month on month in London and the South East according to the House Price index issued by the Land Registry.  Prices in London by borough vary from -2.9pts (Harringey) to +2pts (Kensington & Chelsea) with many boroughs posting increases or decreases of less than a percentage point month on month, which which we would describe as a flat market.

So why can’t I sell my house and why all the doom-mongering?

Sales are down by c. 45pts across the market (see exact figures below), except for property priced at over £2 million, where the volume of sales are up year on year by 9pts.  And anyway, the gloom-mongering sells newspapers and is affecting anyone trying to sell their houses and most of England and Wales.

So why are sales volumes down?

It’s nigh on impossible to find a mortgage with less than a 10pts deposit now and you need 25pts to get the best rates.  So the young professional couple with combined earnings of £80K and a £20K deposit will struggle to get more than £200K mortgage, whereas last year they could have got a better rate and bought for around the £250K stamp duty threshold without any problem at all.

So why can’t Smug and Conceita next door sell their £800K 4 bed terrace?

It’s a chain reaction.  Less first time buyers, means less 2 bedroom flat-owners moving up to family houses and more repossessions means first time buyers would be well advised to chase those.  The plethora of buy-to-letters in mortgage arrears, just less than half the arrears-affected properties according to the Council of Mortgage Lenders, means first time buyers can secure a new or nearly new flat for a fraction of it’s original sale price if they play their cards right and / or get the right advice … hint hint!  So that means the well-advised ones won’t necessarily feed the proverbial chain as they should be buying from people in dire straits.

Also, arguably sales volumes are lowest between £500K and £800K because Sheep and Ewe who sold their 1/2 bed flat for less than it was worth, having read all the doom-mongering and had to contend with Chase Property Search and their Estate Agent.  They are so convinced of Property Apocalypse 2008 they are far too terrified to put money into bricks and mortar until the market has risen so far they will be lucky to be able to downgrade to a 1 bed.   Sounds cruel, but we work for our Clients and we’re not going to let an Estate Agent talk us into offering more than we absolutely have to!  To close that deal just contact this London Property Finder today!

Technorati Tags: London Property Finder, Market Fears, Mortgage Lending Crises, Property Prices sink, Repossessions

Tags: London Property Finder, Market Fears, Mortgage Lending Crises, Property Prices sink, Repossessions

Musings of a London Property Finder

The Alliance and Leicester have cut rates for homebuyers with deposits by 0.55pts but reporting on City Wire today, Iain Martin says that a 25pts deposit is required to achieve the best rates.
Alliance & Leicester cut their loan to value ratio to 85pts from 90pts meaning that First Time Buyers need to come up with a 15pts deposit.  There are still lenders willing to lend 90pts of the value of a home.  The message to First Time Buyers should be threefold:

• Don’t buy if you can’t afford to
• Buy something you can afford comfortably
• If you haven’t managed to save/borrow/blag your 10pts deposit, you are probably not ready to buy.

For those who really want to get onto the property market and have the finances ready, this London Property Finder can find repossessions or other low value property which will perform in the short to medium term.

Technorati Tags: House Purchase Deposits, Interest Rates Fall, London Property Finder, Repossessions

Tags: House Purchase Deposits, Interest Rates Fall, London Property Finder, Repossessions