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Property Prices in Devon & Cornwall Continue to Rise

Thu, 13 Aug 2015 11:33:17 +0100

It remains a fantastic time to move and buy property in Devon and the wider south west as house prices are continuing their unrelenting rise. New figures show the average cost of rising up the property ladder is a huge seventeen percent higher than around 5 years ago.

The Lloyds Bank Homemovers Review says that the average 'step-up' home in the South West is priced at £256,318. However, a few property hotspots like Salcombe in Devon and Padstow in Cornwall cost much more.

Andrew Mason, Lloyds Bank mortgages director, said that the deficit of supply was a primary driver.

"Whilst the number of home movers has risen significantly since 2009, it remains well below previous levels and has recovered less strongly than first-time buyer numbers.

"This is likely to partly reflect the high costs associated with moving home, as well as highlighting the difficulties that home owners can face in finding somewhere suitable to move to due to the shortage of properties available for sale."

Across the United Kingdom, those moving home paid around £50,000 more on average in 2015 to take the next step on the property ladder than they would have done in 2010, the study said.

The median price paid for a house during the first half of the year by someone who was already on the property ladder and relocating to their next home was around £260,000, according to the Lloyds Bank Homemovers Review.

This was a twenty five percent, or around £50,000, greater amount than the average home mover paid in 2010, when the house they were relocating into had a cost of around £200,000.

House movers in the capital are faced with paying forty five percent, or around £150,000, more for a house than they might have done 5 years ago, with houses there now priced at around £500,000.

In 2015 the average deposit invested by a house mover was around £90,000, this is 8% or £6,405 greater than in 2014.

The typical size of a deposit equals just over a third (thirty four percent) of the average £260,000 cost of a home.

Article by Lyn Barton of the Western Morning News shared by Architects Devon Jonathan Braddick
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Prices Continue to Surge Across the South West

Wed, 30 Apr 2014 15:14:53 +0100

According the press house prices are set to continue to surge across the South West by in the region of 6% per year, for the next five years. It is reported that this is as a result of a severe shortage of housing.

Prices across the South West are said to have risen by around 7.5% year-on-year to April. As a result the average home in the South West region is reported to be worth £198,325 – which is close to the pre-recession levels - according to a Nationwide report.

It is believed that as a result of improving consumer confidence generally and Government support schemes, such as Help to Buy, that new purchasers are entering the market place pushing up demand.

Simon Rubinsohn, RICS chief economist, said there is a “desperate need” for more homes to come on the market.

He warned: “Until this happens we’re likely to see prices continue to increase and it is going to be ever harder for many first-time buyers to conceive of ever owning their own home.”

The Nationwide’s latest index showed above-average rises in Somerset, where prices climbed 9%, and parts of Devon, which were up 8%.

Richard Copus, regional spokesman for the National Association of Estate Agents, said the Westcountry could expect a 4% annual rise discounting London.

"Houses are selling more easily..."

Estate agent members of RICS in the Westcountry who participated in the survey, portrayed a mixed picture, with Piers Whiting, of Luscombe Maye in Totnes, reporting that viewings were up by 25%.

“A shortage of new instructions and a good level of sales is leaving a shortage of available property,” he added.

David J Dark, of Seldons in Bideford, said: “Confidence has returned to the market and with price rises now generally expected, the market for selling is the best it has been since the end of 2007.”

Taunton’s Robert J Cooney calculated that the average selling price has increased to £275,000, up 15%, with “noticeably more active buyers at the top end of the market”.

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Number of First Time Buyers On The Rise

Sun, 23 Feb 2014 22:28:41 +0100

New statistics have been published by The Council of Mortgage Lenders (CML) that show an big improvement in the amount of 'first time buyers' qualifying for a mortgage in the last month of 2013.

The statistics indicate an increase in 'first time buyer' borrowing of over 26% year on year. The amount of first time buyers and people moving home got bigger nationally during the last quarter of 2013. There was an annual increase of 37% and 19%. These numbers are reflective of the increasing trend of improved market activity that is being witnessed at the moment. This shows the confidence of both buyers and lenders increasing.

"First-time buyers were an especially important factor in driving the market forward in 2013 as improved economic conditions have given the opportunity for them to enter the market and become homeowners." - CML Director General Paul Smee

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Flats Remain the Property of Choice for those Wishing to Downsize and 2nd Home Owners

Mon, 10 Jun 2013 10:44:27 +0100

The estate agency and mortgage group have reported that the number of first time buyers is increasing.

The group has predicted that the amount of first time buyers increased by 15% in the month of April, and that in the first quarter of 2013 that there were nearly 10,000 more first time buyers than in the same period the previous year.

The findings used information from estate agent brands Your Move and Reeds Rain, that indicated that there were more than 20,000 first time buyers in April, up nearly 3,000 from March.

Price of property bought by first time buyers rose around 2% in April (on average) to a high of £138,632 – 12.1% more than in April 2012. As a consequence first time buyers are needing to find larger deposits and, even with low interest rates, are faced with higher monthly mortgage payments.

David Newnes, director of LSL Property Services, owners of estate agents Your Move and Reeds Rains, said: “Mortgage rates may be at record lows but repayments are equal to a larger proportion of the average first-time buyer’s wage.

“The size of the deposit they must save before they can purchase has increased both in monetary value and as a proportion of wage – a second blow for potential buyers that is large enough to knock many out of the ring and prevent them from buying.”

“Schemes like to Help to Buy are designed to launch a counter-offensive on deposit requirements, but the scheme may actually inflate property prices, so may turn out to be counter-productive.”

The age of the average first time buyer in April 2013 was 30 and with earnings of £33,268 per annum.

Property types that were most popular with first time buyers were 3-4 bed houses, with around half wanting at least three bedrooms. Around 30% of first time buyers were looking for houses with two bedrooms – and this was the 2nd most sought after property type.

Flats came in third for first time buyers, with around 20% of first time buyers looking to purchase a flat in April. Flats therefore are proving to be most popular for 2nd home owners and those wishing to down size.

Nearly 60% of first time buyers expected to remain in their properties for five years or more.

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Article content courtesy of estate agentstoday.co.uk

Mortgage Lending Fell By Nine Per Cent In January, But Banks Insist The Market Is Improving.

Mon, 25 Feb 2013 23:54:49 +0100

It is reported by the Council of Mortgage Lenders (CML) that the level of lending reduced by 9% month-on-month during January. It is estimated that £10.4 billion of lending was advanced last month. This is a 3% reduction on the same period 12 months ago. Even though there is a slowdown, the CML states that it thinks activity to rise in months ahead due to improved mortgage availability and lots of cheap deals on offer.

Other research issued recently by the financial information website 'Moneyfacts' states that a recent mortgage price war amongst banks and building societies has reduced the average fixed rate mortgage rates to their lowest in nearly 25 years.A typical two-year fixed rate deal across all loans-to-value is 4.11 per cent, while a five-year fix has reached 4.14 per cent. In 1989, a two-year fix would have had an average rate of 12.83 per cent while five years was 12.85 per cent.

Record low rates of interest mean that borrowing is cheaper and lenders have rushed to provide their "best ever" mortgage rates, since the Government introduced a 'Funding for Lending' scheme last summer. This gave lenders access to low cost finance.The CML reported recently that the number of first-time buyers in the UK rose to its highest annual level for half a decade in 2012.

The research has also highlighted "encouraging" indications that people with smaller deposits are now also able to access mortgage deals. Nearly one in 40 first-time buyers is taking out a 95% mortgage, in contrast with less than one in 100 twelve months ago. In mean time, over 2,900 homes have been 'reserved' under the Government's 'NewBuy' scheme, this enables home movers and first-time buyers to buy a home with as little as a 5% deposit.

While the mortgage market has got better, many are still faced with strong pressures on their finances as a result of high living costs and a lack of increase in salaries. This is keeping back the desire and ability to borrow more.

CML market and data analyst Caroline Purdey said: "Housing sentiment remains positive, despite ongoing economic pressures."

"A worsening in the outlook for inflation presents a greater headwind, but we still expect the Funding for Lending scheme to lift activity over coming months." and "House purchase activity was robust into the start of 2013, on the back of better mortgage availability and pricing, and we share the Bank of England's confidence that this will continue over the coming months."

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Lenders insist the housing market recovery IS here!

Thu, 24 Jan 2013 17:44:43 +0100

Mortgage lenders are insistent that the housing market recovery is under way.

The Council of Mortgage Lenders says it “may be easy to overlook the recovery that has already quietly been under way”, with consumer seing not yet caught up.

The CML gives ten reasons for its positive outlook, starting with a claim that last year there was the highest number of property transactions since the onset of the credit crunch.

Although the Land Registry data on transactions for 2012 will not be available for several weeks, the CML believes there were some 930,000 transactions. It has reached its figures using HMRC data and estimating December’s sales. However, according to the Land Registry’s most up-todate data, there were just 588,835 property sales in England and Wales up until the end of November.

The CML also believes that the number of first-time buyers is at a post-crunch high, although accepting that the current market is not easy for first-timers. However, it says that the pre-crunch market was not easy for first-time buyers either, and that the UK has a decades-long backlog of not producing enough new homes.

The eight other reasons the CML gives for believing that the housing and mortgage markets are in recovery are:

1. The availability of 90%-plus LTV mortgages has more than doubled in the past two years
2. There is ‘much more’ lending at higher LTV levels
3. More first-time buyers are entering the market without assistance
4. Lenders expect to offer more high LTV mortgages this year
5. NewBuy – the controversial taxpayer-backed scheme whereby purchasers of new-build properties only are able to get 95% mortgages – is being extended
6. Lenders are innovating responsibly – the CML cites Lloyds lend-a-hand mortgage, Nationwide’s save-to-buy scheme and Barclays’ new Family Springboard mortgage
7. There is ‘constructive’ forward planning going on within the mortgage industry
8. The outside world is beginning to notice the improvement in lending conditions. The CML says that people are beginning to notice that lenders are open for business.

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Number of First Time Buyers Increases

Mon, 14 Jan 2013 13:53:04 +0100

The latest research from Halifax has shown that there were approximately 12% more first time buyers in 2012, an increase of 193,000 since 2011. This is the largest annual total since 2007.

Halifax’s research further detailed that the average price paid by the typical first time buyer in November 2012 was affordable based on the average UK wage.

The typical property price paid by a first time buyer last year was £139,921 showing a 3% increase on 2011. The Telegraph recently reported that approximately 38% of homes purchased by first time buyers cost between £125,000 and £250,000.

Other statistics showed that the average age of a first time buyer is now 30, an increase of one year from 2011 and that the average price paid by a first time buyer is highest in London, over 2.5 times that paid in the North.

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Landlords look to increase their portfolios

Mon, 01 Oct 2012 16:50:39 +0100

New research from Paragon Mortgages has revealed that UK landlords want to add to their portfolios in Q4 2012 as reported on houseladder.co.uk.Paragon Mortgages’ research showed that terraced houses and flats are becoming increasingly popular with buy-to-let investors.

10% of landlords believe they will add to their portfolio in the last quarter of the year and professional landlords are more likely to buy than their smaller scale counterparts.

Managing Director of Paragon Mortgages, John Heron thinks that it’s positive that people want to purchase different types of property. He is of the opinion that this is a result of a “higher demand for larger rented properties from families who are choosing the private rented sector because they do not want to or cannot buy in today's difficult economic environment".

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House prices in 'surprising' jump says Nationwide

Sun, 16 Sep 2012 15:14:27 +0100

House prices jumped a "surprising" 1.3% in August, the Nationwide building society has said.

It was the biggest monthly rise since January 2010 and left the average UK house price at £164,729.

It means prices are only 0.7% lower than a year ago, despite the recession and continued mortgage rationing.

However, the society's chief economist, Robert Gardner, warned that "we should never read too much into one month's data".

"Nevertheless, the fact that the annual pace of house price decline moderated to minus 0.7% in August from minus 2.6% the previous month provides evidence that conditions remain fairly stable.

"This may be explained by the surprising resilience evident in the UK labour market, with further increases in employment in recent months, even though the UK economy has remained in recession," he added.

Russell Quirk, of estate agents eMoov.co.uk, said: "Read nothing more into August's 1.3% rise than low transaction levels.

"Prices are jumping around from one month to the next and September could just as likely see a reverse."

Mortgage rationing

Separate figures suggest that the Bank of England's Funding for Lending scheme, which started at the beginning of August, has yet to make mortgages cheaper or more easily available.

Commentators have pointed out that improving the flow of mortgage funds depends not so much on cutting the interest rates payable by borrowers, but on relaxing the stringent deposit requirements being set by lenders.

Figures from the financial information company Moneyfacts show that 68% of all mortgage deals on offer still need a deposit of at least 20% of the value of the home being bought.

A year ago, only 64% of mortgages required a deposit of this size.

Funding for Lending will offer lenders about £80bn of cheap money, on condition it is lent to borrowers.

At the end of July, some big lenders launched four- or five-year fixed rate deals at ultra-low interest rates of less than 3%.

These have now become slightly more expensive, with interest rates just above 3%, but in any case, they were aimed only at borrowers who could put down a 30% or 40% deposit.

At the other end of the scale, Moneyfacts says there are only five deals currently requiring no deposit at all, just 62 asking for a 5% deposit and 259 requiring a 10% down payment.

Altogether they amount to just 14% of all the deals on offer, similar to the position a year ago. Aaron Strutt, of mortgage brokers Trinity Financial, said: "There are only four of five lenders offering stand-alone 95% loan-to-value mortgages that do not require parental assistance and the rates are still not cheap.

"There are a number of lenders offering 95% mortgages, but they often ask for a family guarantee. Also, a few of them will only lend in selected postcodes."

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Lloyds Banking Group is set to lend £5bn to first-time buyers by the end of 2012

Mon, 13 Aug 2012 11:01:24 +0100

Lloyds Banking Group is set to lend £5bn to first-time buyers by the end of 2012. This amount will help over 50,000 people to get on to the housing ladder.

The lender is supplying mortgages to one in four first-time buyers ensuring its place as the largest lender in the current market.

Its Halifax sector provides one in three mortgages for affordable housing schemes such as shared ownerships and shared equity. It also provides one third of lending for all of the UK’s new build properties.

Stephen Noakes, Lloyds’ Mortgage Director, noted on homemove.co.uk that: “With our unrivalled commitment to affordable housing, new build through Halifax, and innovative products such as Lloyds TSB’s Lend a Hand, we’re not targeting our support at a select few, but making home ownership a reality for a whole generation of buyers.”

Mr Noakes also wanted to advise first-time buyers that it is possible to purchase property with a 5 or 10% deposit.

Lloyds TSB and Halifax have recently reduced rate on NewBuy and new builds loans and Halifax is soon to introduce a deal that means that first-time buyers with a 10% deposit will receive £1,000 cash back.

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