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Over half of UK first time buyers rent before they buy
More than half of the UK’s first time buyers now try before they buy when it comes to owning their first home, according to an annual survey. The research from Clydesdale and Yorkshire Banks found that 54% of the nation’s first time buyers rent before they take the house buying plunge. A further 35% stay with family and 6% rent but move back to the family home to save for a deposit. The same survey last year revealed that 67% of first time buyers in the UK were waiting longer than planned to buy their first home with more than half of those surveyed revealing it had taken up to three years longer than anticipated. There is a clear financial benefit with 39% of those at home claiming to live rent free. Some 61% pay rent every month and a further 21% make a contribution through helping at home, paying bills or buying food for the household. However, 80% of Scots living at home pay rent compared to just 46% of those in London. The majority, 56%, of first time buyers said they feel pressure to buy their own home and this is felt most keenly amongst those renting a property. There were regional variances with 65% of first time buyers in London admitting to pressure to take their first step onto the property ladder. This compared to just 37% in the North East. ‘We know that first time buyers face a number of pressures and challenges and are focused on providing support throughout the process from helping to save for a deposit to finding the right mortgage to suit different needs and budgets,’ said Steve Fletcher, head of Clydesdale and Yorkshire Banks retail network. He pointed out that Clydesdale and Yorkshire Banks are offering first time buyer mortgages with a 5% deposit. ‘We are proud that we were one of only a handful of lenders who continued to support this market throughout the economic downturn,’ he said. First time buyers with a deposit from as little as 5% can apply for a first time buyer mortgage and receive the benefit of no arrangement fee, £250 cashback and one free home valuation. The Banks offer a three year fixed rate of 3.59% with 90% LTV or 4.89% for a three year fixed with a LTV of 95%. Continue reading
Landlords needing to evict a tenant face rising UK court costs
Rising court fees in the UK could tempt law abiding landlords to cut corners when it comes to tenant evictions, it is claimed. For the second year running, the Ministry of Justice is increasing fees for landlords who want to evict tenants who have fallen into rent arrears. The cost for filing a paper application will rise by £75 to £355. Online applications will rise from £250 to £325. This comes on top of increases last year of £100 for online applications and £175 for paper claims. According to Legal 4 Landlords the spiralling court costs could lead to landlords being tempted to evict problem tenants without following official procedures, risking prosecution and a criminal record. ‘The spiralling costs are unfair and are hitting landlords in the pocket yet again. However, the law is complex and too many landlords serve invalid notices delaying the process and waste their money,’ said Sim Sekhon, managing director of Legal 4 Landlords. ‘Landlords must follow the correct procedure and expert guidance is paramount. Evicting a tenant is stressful enough but many landlords are concerned about rising court costs so it’s not surprising some are tempted to take the law into their own hands,’ he added. The firm explained that there are several routes that can be taken to evict a tenant and every case is different. The court expects landlords to follow procedures to the letter so they should always seek expert guidance. Legal 4 Landlords offers a range of services for landlords and letting agents with a network of offices across the UK. This includes advanced tenant referencing and general insurances products. It offers a free eviction case review and recently launched a rent and legal protection insurance product. This safeguards landlords from future hikes in court costs at the legal stage for landlords who may need it for their next tenants. The number of people evicted from rented properties hit record levels in 2014, with 42,000 homes repossessed by landlords, according to the Ministry of Justice. Continue reading
New home sales in Australia reach new peak
Total seasonally adjusted new home sales increased by 1.1% in Australia in February following a gain of 1.8% in January, according to the latest data. It means that sales volumes are now just above the previous peak of April 2014 and a breakdown of the figures show that apartments are selling more than detached homes with flat sales up 11.1% and houses down 1.3%. But there are considerable regional variations. Detached house sales are easing in New South Wales and Western Australia, previously key drivers of growth, and have fallen significantly in South Australia. According to Harley Dale, chief economist of the Housing Industry Association (HIA), the modest growth in new house sales in Queensland and Victoria is not enough to offset these declines. The data shows that in February detached house sales increased by 1.5% in Victoria and by 0.2% in Queensland. Detached house sales fell 4.8% in New South Wales, 2% in South Australia and 2.9% in Western Australia. The level of sales in the three months to February 2015 compared with the previous three months was down 6.9% in New South Wales, down 2.8% in South Australia, and down 1.3% in Western Australia. Sales increased by 3.8% in Victoria and by 9% in Queensland. ‘This is another very strong result for Australia’s national new home building sector. In January, new dwelling approvals reached their highest level on record and now in February that activity remains at exceptionally high levels, with a solid pipeline of activity set to remain in play over the coming months,’ said HIA senior economist, Shane Garrett. Data also shows that new home approvals in February were 3.2% lower than the previous month but still recorded their second highest level since figures began 32 years ago. Detached house approvals inched up by 0.2% while there was a 6.6% fall in multi-unit approvals and according to Garrett at a time of weak overall domestic demand, new residential construction is acting as a welcome pillar of support. ‘A steady pipeline of new homes represents the most effective solution to alleviating housing affordability pressures. Governments at all levels must work to ensure supply constraints do not impede the continuation of elevated levels of new home construction,’ he explained. A breakdown of the figures shows that new home approvals increased most strongly in Victoria with a rise of 20.5%, followed by New South Wales up 13.5%, and Tasmania up 4%. But they fell by 8% in Western Australia, were down by 30.6% in Queensland and by 41.4% in South Australia. Garrett said that action to turn around new home building conditions in South Australia are urgently required. New home approvals declined in trend terms in both the Northern Territory with a fall of 2.7% and the Australian Capital Territory with a decline of 16.2%. Continue reading
