November 21st, 2011
The Prime Minister David Cameron is to announce his new £400 million Housing Building Fund at a meeting today with the Confederation of British Industry.
The scheme is intended to stimulate house building by enabling first-time buyers to borrow mortgages of up to 95 per cent loan-to-value.
Cameron and Deputy Prime Minister Nick Clegg issued a statement in advance of the announcement, stating, ‘The housing market is one of the biggest victims of the credit crunch: lenders won’t lend, so builders can’t build and buyers can’t buy. That lack of confidence is visible in derelict building sites and endless For Sale signs.’
A new Mortgage Indemnity Scheme is intended to help buyers onto the housing ladder by taking on part of the risk when mortgage lenders lend 95 per cent loan-to-value on new-build properties. This is intended to prompt more young people to buy a home for the first time.
The government said, ‘We’ll be making it easier for people to secure mortgages on new homes, help people get on the property ladder, address unfairness in social housing and ensure homes that have been left empty for years are lived in once again.’
November 9th, 2011
House sales are picking up, according to one of the UK’s largest house builders, Persimmon.
The figures have reassured the house building market that some stability has returned after a period of poor sales.
Persimmon is the second largest house builder in the UK and has reported sales growth of 19 per cent since the beginning of September 2011. The growth in sales has been attributed to several factors, including a government scheme to incentivise first-time buying.
Some 9,300 homes were sold by the developer in the last building year and it claims that forward-looking sales are also strong. The increase in mortgage availability has also been cited as a reason for the sales pick-up.
Mike Farley, the chief executive of Persimmon, stated, “It’s a bounce back for the group as a whole but slightly stronger in the north which is pleasing for us.”
When asked about the impact of the Eurozone crisis, he told the Financial Times, “The man on the street is not worried about Greek debt. The only worry for us is mortgage availability and this has gradually improved.”
November 2nd, 2011
Slow house building growth and continued caution over the future of the economy have contributed to claims that the housing market is still “subdued” despite small price gains.
Figures from Nationwide show that house prices rose by an average of 0.4 per cent last month. However, areas in London and the South East, which are classed as regions where “wealthy high achievers” live, saw higher house price increases – with average prices rising by 3 per cent since 2008.
The shortage of housing in these regions is contributing to the house price gains, as fewer homes for sale results in more interest in the ones that do come onto the market.
In the year to October 2011, the average house prices have risen by 0.8 per cent, to £165,650. Despite the gains, Robert Gardner, the chief economist at Nationwide, said, “The outlook remains uncertain but, with the UK economic recovery expected to remain sluggish, house price growth is likely to remain soft in the period ahead, with prices moving sideways or drifting modestly lower over the next 12 months.”
October 31st, 2011
The government risks allowing a ‘house building ice age’ to occur if it does not continue with its commitment to helping the industry build more homes through changes to the planning regulations.
This is according to the Home Builders Federation (HBF), representatives of which spoke at the Housing Marketing Intelligence Conference. The organisation’s executive chairman, Stewart Baseley, took the opportunity to urge the government against pandering to the “complete and utter nonsense” of the anti-development lobbyists, or risk an even worse housing shortage in the future.
Currently, the government’s plans, known as the National Planning and Policy Framework, are in consultation and are coming up against some heavy campaigning from anti-development groups who are concerned about the impact the looser planning regulations could have on the countryside, among other things.
Mr Baseley claimed that delaying the implementation of the planning changes, as the campaigners are requesting, would be short-sighted. He explained, “[Delaying] will prolong the limbo that has existed since the 2010 General Election with the old system dead but yet to be replaced. The result in too many places would be a continued failure to plan for growth or address the housing crisis in their areas.”
October 28th, 2011
Savers that set clear goals are more likely to successfully put their desired amount of money aside each month, according to research from National Savings and Investments.
Around a fifth of the savers who set goals save more than £250 per month, compared with only 10 per cent of those who do not set savings goals.
The most common savings goal is currently a house deposit, while other popular goals include holidays, retirement, cars and children’s future.
A spokesperson for NS&I, John Prout, said, “We would encourage people to think carefully about their daily expenditure, and use a goal to motivate them to help boost their savings pot.”
He added that there are now a range of online tools to help households budget and track their spending to try to free up more cash for their savings accounts or bonds.
The level of saving on average is falling as a result of the ongoing tough economic climate. The latest figures show that one in five of us has less than £1,000 in savings, while 13 per cent do not have any savings at all.
October 24th, 2011
Housing Minister Grant Schapps has told Radio 4 listeners that the government needs to build a total of at least 200,000 homes per year to keep up with demand.
He said that the measures being taken by the government to provide extra housing were necessary to avoid rents increasing even further and to make sure there is enough affordable housing for those who want to buy.
Speaking on the Today programme, he said that the government will be releasing its own land to developers who want to ‘build now, pay later.’ He also outlined plans to launch the Right to Buy scheme again, which will give people the right to buy their council houses.
Schapps explained, “We think there has to be a couple of hundred thousand new homes created each year – something in that kind of order.”
He went on to add how several steps need to be taken at once to try to help fill the housing gap: “Overall, you have to get all things working in tandem – there is not one single thing you can do to solve a housing crisis that has been building up over years and years.”
October 12th, 2011
Some good news about UK savers has emerged, which suggests that Brits are investing more cash in their savings accounts.
The Savings’ Snap Shot from Santander found that the average Briton is now saving 12 per cent more than they were a year ago – suggesting that we are finally wising up to the importance of having a savings account to fall back on.
The average saved each month is £114, with men still saving more than women, at an average of £132, compared with just £98 for women.
A year ago, almost a third (30 per cent) of people asked said they had no savings. This percentage has now fallen to just 21 per cent, which is a good sign for the UK economy. The average amount held in savings accounts among those questioned was £20,604, with 9 per cent holding their money in a savings bond.
As for the amount paid into savings each month, a quarter of people said they hope to increase the amount they save each month within the coming three to six months.
October 10th, 2011
Grant Shapps, the housing minister, claims that some 50,000 plots for affordable homes have been identified.
Speaking at an event organised by the Home Builders Federation and the National House Building Council, he said that the government’s plans to free up more land for house building were advancing well. After asking all government departments to help in identifying land that could be sold to housing developers, Shapps stated, “space for 50,000 of the 100,000 homes has already been identified”.
Although some welcomed the new space for homes, others said that freeing up government-owned land will not do enough to stimulate the housing market. Mike Leonard of the Modern Masonry Alliance, said, “[The government's] creativity in trying to come up with no cost to government schemes is to be admired but unfortunately it will not work. Government needs to pump prime the housing market to deliver jobs and growth.”
He also called on the government to start the process of building affordable homes now to try to at least spark economic growth.
October 10th, 2011
30th September 2011
Although bridging loans and other short-term finance are most commonly used when developing commercial property, individuals can also use this type of funding to secure land on which to build property.
This is increasingly popular and has been examined by Bridging and Commercial. It claims that bridging loans are increasingly being seen by people as a great way to secure the money they need to buy a piece of land on which to build a home. Once the land is secure, they can build a house on which a regular mortgage can be obtained and the bridging loan can be repaid.
This type of finance used for land acquisition can help buyers to secure a piece of land at a bargain price, as the money is available quickly. Bridging and Commercial explained that this type of finance would usually be offered after a lender reviewed the plans of the home that is scheduled to be built.
Open bridging loans can be offered to people who do not have a firm completion date for their house development projects, while a closed bridging loan may be more appropriate for those who have a set completion date for their project.
October 5th, 2011
Half the population of Britain has savings of less than £1,000, according to a new survey.
The increasing cost of living is causing more and more people to dip into their savings pot to make ends meet, meaning the amount they have put aside for a rainy day is seriously depleted.
The survey by Norwich and Peterborough Building Society found that 77 per cent of those questioned said they are also cutting back on their spending.
Alarmingly, 25 per cent of over 55s have no savings at all, which means that come retirement, they will be reliant on the minimal state pension, which could leave them severely lacking the cash they need for a decent quality of life.
Women are expected to suffer the most from a lack of savings, as the survey found that one in three had no savings, compared with one in four men.
Having savings put aside in a savings account or bond is essential during these tough economic times as unexpected expenses can rear their head and unemployment is still hitting lots of households in certain regions.
