Tag Archives: crisis
Fewer loans for first time buyers and home movers in UK
First time buyers in the UK saw a drop in lending in January compared to the previous month and the same month in 2014, according to the Council of Mortgage Lenders. There were 19,000 loans advanced to first time buyers January, down 27% on December and 14% compared to January 2014. These loans by value were £2.8 billion, which was down 26% on December and 10% down on January last year. The data also shows that home movers were advanced 22,400 loans, a decline of 24% compared to December and 17% down year on year. These loans totalled in value £4.2 billion, 24% down on December and 14% down compared to January 2014. However, remortgage lending increased month on month with 25,600 loans advanced, up 15% on December but 12% down on January 2014. The value of these loans at £4.1 billion also increased month on month by 21% but was down 5% year on year compared to January 2014. There were 18,200 buy to let loans in January, up 6% on the previous month and up 12% on the same period in 2014. These loans came to £2.5 billion in value, unchanged compared to December but up 14% on January 2014. ‘The traditional beginning of year seasonal lull in lending is slightly more prominent in house purchase lending than in previous years, especially in comparison to the particularly strong levels at the start of 2014,’ said Paul Smee, director general of the CML. ‘Affordability constraints remain a factor for would-be borrowers, but we are still projecting lending to pick up over the next few months. Increases month on month in remortgaging, both for home owners and in the buy to let market, are welcome given the recent static nature of remortgage activity. Interest rates are looking unlikely to go up in the very near future and the greater availability of good mortgage rates has probably motivated people to look at a change,’ he explained. As previously reported, gross mortgage lending reached £14.8 billion in January. This represents an 11% decrease from December’s gross lending total and is 8% lower than lending in January 2014. The CML also pointed out that the data on which the results are based on the Financial Conduct Authority's statutory reporting, which is currently in a transition phase following the implementation of the Mortgage Market Review. As a result this month's data may be subject to greater revisions than usual reflecting the transition arrangements. According to Adrian Gill, director of Your Move and Reeds Rains estate agents, the data shows how the mortgage market has changed its’ spots in the last year. 'Lending has been tamed as new regulations and affordability checks have strengthened the borrowing process. Mortgage brokers are doing a more robust job and buyers are get sturdier solutions at the end of it. Although mortgage approvals are now running at more manageable levels than they were this time last year, the first time buyer market… Continue reading
Second phase of UK custom build fund announced
The second phase of a multi-million pound fund to help aspiring custom and self builders in the UK get their projects off the ground more quickly has been announced. The second phase of the £150 million fund is now open to bidders and will create up to 10,000 so-called ‘serviced plots’ which is land prepared for house building and connected to utilities such as gas and water, so builders can go straight in and build. According to Housing Minister Brandon Lewis the average self build takes two years but those using serviced plots can cut this by up to a year and he believes it will help further unlock the massive potential the custom build industry has to expand. The custom and self build industry currently accounts for around 10,000 new homes every year but the government is backing industry led efforts to double that by 2020. The £150 million fund is open to small builders and community groups as short term loans to help get the land ready for housebuilding. The land can then be sold as individual plots to people looking to build their own home. Lewis said he was determined to ensure as many people as possible could fulfil their custom build ambitions so he has given the green light for the first three bids to proceed to the next stage of assessment. Subject to successful completion three small builders in St Helens, South Norfolk and West Lindsey will receive a share of £850,000 to help provide 41 plots. ‘Custom build should not be something that’s confined to a small and select group of people. Anyone who aspires to build their own home should have the opportunity to do so. We want to see the industry grow significantly and this £150 million fund will help further unlock the massive potential it has to help even more people achieve their ambitions,’ said Lewis. ‘This fund will help create shovel ready serviced plots so small developers and custom builders can get on and build, finishing their projects more quickly,’ he added. Continue reading
UK home owners waiting longer than expected to move up housing ladder
Some 33% of home owners in the UK expected to be further along the housing ladder than they are now, according to new research, rising to 44% for first time buyers. The survey from Lloyds Bank also found that 83% believe home owners have to wait a lot longer to reach their long term family home than a decade ago while 36% of first time buyers hope to achieve their housing aspirations by the time they are 45. Despite recent improvements in the housing market, 40% still consider the housing market to be having an impact on aspirations, although this figure has fallen since 2013 when it was 47% and 2012 when it was 53%. Almost half, 48%, of first time buyers think that the housing market will have an impact on how long it takes them to reach their family home. Even with anticipated delays in moving up the housing ladder, 44% expect not to make any compromises and believe their long term home is a realistic achievement and 18% expect it to be a better property than their childhood home. ‘Many current home owners clearly still feel that they are not progressing up the ladder as quickly as they would like, with higher house prices in some regions meaning people are waiting longer to move into to their long term family home,’ said Andy Hulme, mortgages director at Lloyds Bank. ‘Despite this, almost two thirds still believe they’ll be in their long term home in less than five years, with the vast majority thinking this will only require one more move,’ he added. The research also shows that despite an increase in the number of people feeling they need a bigger property, the house that the majority of home owners in the UK aspire to own has three bedrooms with 43% seeking this kind of property. Some 24% want four bedrooms, with many people aspiring to have nice gardens, conservatories and high quality kitchens and bathrooms. Some 63% of home owners believe they will reach their long term family home in less than five years while 64% of those who are still waiting to be in their long term home think they will only have to make one more move to achieve their housing aspirations. Applicants for three bed properties, which are seen by many as long term homes, are on average 35 years old in London and the South East. This is a year older than the national average. These regions remain the least affordable in the UK for three bed houses, as a result of the high house prices. In contrast, long term family homes in the North and Wales are more affordable with the average three bed property costing £129,447 in the North and £135,070 in Wales. Average incomes of the applicants are lower at £38,606 and £36,390 respectively, but long term homes are still more affordable in both regions. Continue reading
