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Technology could help combat mortgage fraud, it is claimed
Half of UK mortgage brokers believe greater use of technology by lenders when carrying out due diligence on borrowers would reduce mortgage fraud, according to new research. Lying about occupancy to gain a mortgage on a buy to let property was the most common type of fraud that could be reduced by more use of technology, according to 46% of respondents to the survey carried out by online property data network EDM Mortgage Support Services. Other types of fraud that could be reduced by more technology cited by brokers include income or employment falsification, 44%, concealing debts and liabilities, 39%, identity theft at 37%, obtaining multiple loans on the same property, 34%, and over valuing properties at 24%. Despite this, only 17% of brokers believe lenders are implementing enough technology to deal with fraud. Some 35% of mortgage brokers say the Mortgage Market Review (MMR) has not reduced the chances of fraud at all while another 2% say it has actually increased it while 56% believe the MMR has reduced the chances of fraud. ‘The argument for more use of electronic data and communication is getting stronger, not just as a result of the greater administrative burdens resulting from MMR but other issues too, such as tackling fraud,’ said EDM MSS managing director Joe Pepper. ‘There is already some use of electronic data exchange, more than a third of the brokers in our survey say they between 81% and 100% of the information/correspondence they exchange with lenders is done so electronically,’ he pointed out. ‘But there is potential for this to be much greater and more extensive use of quality online systems would help the mortgage industry deal much more efficiently with large amounts of data and correspondence,’ he added. EDM Group is investing in EDM MSS to further enable it to capitalise on the growing data exchange and technology needs in the mortgage and property sectors. Continue reading
Prime property prices in Edinburgh up for fifth quarter in a row
Property prices in the Edinburgh City prime market rose for the fifth consecutive quarter between June and September despite a slowdown due to the referendum vote. Prices increased by 1.3% and are 4.9% higher on an annual basis and so far in 2014 transactions are 8% higher than a year ago, according to the latest report from real estate firm Knight Frank. Low stock levels and high demand are the main two characteristics which have typified the Edinburgh market so far this year and they have put upwards pressure on price. A snapshot of stock levels at the end of September reveals that there were 27% fewer properties available for sale than the same time last year. However, applicant numbers were 19% higher in 2014 to date compared to 2013 and viewings increased by 1% over the same time. According to Knight Frank, it is evidence of just how resilient the Edinburgh property market has been this year in spite of the uncertainty surrounding the outcome of the referendum. Indeed, agents reported activity only noticeably slowed in the three week period before the vote. Since the result was announced activity has returned to more normal levels, suggesting that at least for now it is back to business as usual. The result means there is now a more certain environment for the property market to function and it is expected that this, combined with growing consumer confidence, should act as a further boost for the city’s already robust prime market. ‘While the flurry of activity that was predicted in the event of a No vote hasn’t materialised yet, we have dealt with a number of buyers and vendors who put off making decisions until after the vote,’ said Edward Douglas-Home, head of Edinburgh City sales at Knight Frank. ‘The recent figures highlight just how buoyant the Edinburgh market has been. Premiums have been paid for the very best homes in the best locations and high demand from would-be buyers is evident across the market. We expect that activity will continue to pick up in the coming months,’ he explained. However, despite the optimism in the market, the market has more hurdles to clear, most notably the ongoing negotiations between Holyrood and Westminster concerning further devolution and the upcoming May 2015 UK general election could create more uncertainty, especially when it comes to tax changes affecting high-value residential property. Additionally, from April 2015, Stamp Duty for Scottish residential and non-residential property sales (SDLT) will be replaced by a new Land and Buildings Transaction Tax (LBTT), which will be administered and collected within Scotland. Guidance surrounding the final rates will be provided this month, but it is expected that buyers of more expensive homes will have to pay more tax up front when purchasing a property. Meanwhile, the No vote in the referendum could Now that the uncertainty of the referendum is over there could be a rise in the number of people from London who would rather own property in Edinburgh and commute,… Continue reading
UK house prices down 0.6% in September, latest index shows
In another sign that UK property price growth is slowing the latest index figures show that they increased by just 0.6% in September to an average of £187,188. The index from the Halifax also shows that inn the three months to September they were 2.7% higher than in the preceding three months. However, this was the second successive decline in the quarterly rate. Annually, prices were 9.6% higher in the three months to September than in the same three months last year. This was similar to the 9.7% recorded in August and below July’s 10.2%. ‘The recent rapid rise in house prices in some parts of the UK, earnings growth that remains below consumer price inflation and the possibility of an interest rate rise over the coming months, appear to have tempered housing demand,’ said Martin Ellis, Halifax housing economist. ‘This weakening in demand has led to a modest easing in both house price growth and sales. Annual house price inflation may have peaked around 10%. A moderation in growth looks likely during the remainder of 2014 and into next year as supply and demand become increasingly better balanced,’ he added. The Halifax report also points out that mortgage approvals for house purchases, a leading indicator of completed house sales, fell for the second consecutive month in August, to 64,200. According to seasonally adjusted figures from the Bank of England, approvals were 16% below their recent peak in January 2014 and only 1% higher than in August 2013. Also, the number of new buyer enquiries fell for the second consecutive month in August, according to the latest data. Market conditions, as measured by the ratio of house sales to the stock of unsold properties reported by the Royal Institution of Chartered Surveyor's monthly survey loosened slightly in August as a result of lower sales. This suggests a better balance between supply and demand is materialising which, if sustained, would help to dampen the pace of house price growth. According to Jonathan Hudson of West End estate agent in London, Hudsons Property, the new figures are not a surprise. ‘House prices in London haven’t risen in the same period so whilst this shows growth nationally, one shouldn’t forget that the figures mainly represent property transactions which were agreed some time before. Therefore, it will be interesting to see how the London slow down affects the UK market over the next quarter,’ he said. ‘Prices in the three months to September being 9.6% higher than in the same three months a year earlier, is again not surprising given the huge rises we have seen in the UK, especially over the last 10 months in areas which haven’t seen growth since 2008,’he pointed out. ‘The 0.6% increase between August and September shows transactions that were agreed sometimes months before and completed in this time frame,’ he added. Continue reading
