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Majority of UK landlords not getting enough from lenders, it is claimed
Despite the recent launch of new mortgage rates and new terms for buy to let landlords, a new study shows that over three quarters of landlords believe that banks are not doing enough to support them. Just 17% of landlords feel they are getting enough support from lenders and one in ten have faced problems securing a buy to let mortgage, says the research from online letting agent PropertyLetByUs. The research also reveals that 87% of landlords believe the mortgage fees for buy to let loans are too high, while just 13% believe the interest rates are reasonable. This comes as figures show that over 70% of landlords have taken out a mortgage in the last six months to purchase a buy to let property and 19% have taken out a mortgage to refinance a loan. ‘Our research shows that lenders have some way to go to reassure landlords that they are supporting the buy to let sector. However, since the banking crisis of 2007, there has been a gradual increase in the availability of finance for buy to let landlords and the choice of mortgage products today is better than it has been for a long time,’ said Jane Morris, managing director of PropertyLetByUs. She explained that buy to let lenders typically want rent to cover 125% of the mortgage repayments and many are now demanding 25% deposits, or even larger, for rates considerably above residential mortgage deals. The best rate buy to let mortgages also come with large arrangement fees. ‘Landlords need to be cautious with mortgage fees as they can substantially push up the cost of a mortgage, especially if landlords are only fixing, or tracking for a short deal period. The biggest fees are typically those charged as a percentage of the loan, but even flat fees can run to £2,000,’ said Morris. ‘There are currently some good buy to let mortgage products on the market. For example, the lowest rate available now is 2.2% from Principality Building Society. It comes with a £994 fee and requires a 40% deposit. The total cost on a £150,000 mortgage would be £7,594 for the deal term,’ she explained. ‘For a longer term deal, The Post Office has a five year fixed rate at 3.65% with a £995 fee for a 40%. A £150,000 mortgage would cost £28,370 over five years,’ she added. Continue reading
Online research becoming important for many UK buyers, survey suggests
The impact that technology is having on the estate agency sector in the UK is changing the property buying and selling landscape, it is claimed. With the explosion in popularity of buyers and sellers using portals such as Zoopla and Rightmove and the wealth of historic pricing data available, the internet has become the essential tool for the modern day house hunter. A survey carried out by online estate agent eMoov has found that the majority of buyers are well armed with information before they step through the door when viewing a property. Some 98% of respondents said they would take it upon themselves to do some research before attending a viewing in anticipation of finding the right property. The first step in the process is usually to visit the property details page and read the full property description, the starting point for 67% of those surveyed. For some this was as far as the research process went, however 41% would also like to view a floor plan. The research found that 36% would also compare a property to others listed in the area and 21% of buyers would research previous property sold prices. Consumers showed less priority to researching the surrounding area with 14% investigating changes to their commute and 11% taking school catchment areas in to account when digging for further information. Local authorities provide a wealth of information on school catchment areas and make it readily available online for prospective and existing parents looking to relocate. Zoopla also keeps potential buyers well informed showing the nearest schools as well as information on transport links and crime rates amongst others. Broadly speaking women would conduct more research than men when preparing to view, taking more time to consider the look, layout and practicality of a house. However their male counter parts did pip them to the post where value for money was concerned, with 40% of men looking at other listed properties in the area and 24% researching historic property prices in comparison to 33% and 18% of women respectively. With the internet only coming to full fruition over the past two decades those over the age of 50 fall under the label of technological novices. Using technology as relative beginners and adapting in comparison to their younger counterparts, or technological natives, for whom it has become second nature. However the rise of the silver surfer has very much risen with the elderly becoming a core demographic for surfing the net, they account for a large percentage of people using the internet to help them buy. Three quarters of those surveyed over the age of 50 would log on to read a full property description before viewing, a far greater number than those in the younger age brackets. This was also the case when checking floor plans, researching properties in the surrounding area and checking historic property values and potential new neighbours. However younger buyers are more interested in Google Street… Continue reading
Positive outlook for overseas buyers in the Caribbean and Central American
Property sectors in the Caribbean and Central America are set to grow in 2015 with the quality of life, good value for money and stability attracting more people to these regions, it is claimed. According to an analysis by 7th Heaven Properties the Caribbean region has reinforced its appeal to property buyers and investors, particularly in the face of social, economic and political volatility in other regions. ‘Many investment locations such as the Turks and Caicos, the Bahamas and the Cayman Islands experienced strong growth last year and we expect 2015 to be the year that the Caribbean real estate market as a whole turns a corner,’ said Walter Zephirin, managing director of London based 7th Heaven Properties. ‘A growth in enquiries from prospective buyers indicates a renewed confidence in the region and sales levels on many islands are returning to pre-crisis levels,’ he explained. He pointed out that locations across the Caribbean and Central America are benefiting from an upturn in the US, Canada and the UK, resulting in an increase in visitor arrivals, tourist spend and property sales. ‘A growing pipeline of new projects, significant infrastructure investments and a thawing in relations between the USA and Cuba are also expected to provide an additional boost to the region,’ he added. The firm believes that a positive economic outlook for the Caribbean and Central America region, with GDP forecast to grow 5.8% in Panama and 4.8% in the Dominican Republic in 2015, will attract property investors. There has been a series of announcements relating to new luxury residential developments in multiple locations, including Antigua, Costa Rica, Honduras and Panama and of government programmes to incentivise property buyers, including Citizenship by Investment in Antigua and Barbuda, Grenada and St Kitts and Nevis as well as retirement programmes in Belize and Panama. On top of this there has been an increase in direct flights to destinations including Costa Rica, the Bahamas, the Dominican Republic and St Lucia improving access for tourists and property buyers as well as recent and on-going investments in private jet terminals and airport upgrades. Royal Westmoreland, a gated community and golf estate on the west coast of Barbados has just launched a fractional ownership option in response to feedback from regular rental guests who said they simply don’t have the holiday time to commit to full ownership. Kim Goddard, head of sales at Royal Westmoreland, said that the fractional ownership program allows for purchasers to own just the time they intend to stay at the resort. The property is held freehold/deeded in a third party trust in the Isle of Man, governed under UK commonwealth property law, and ownership shares in the villas are fully transferable, and sellable. ‘We often find that potential purchasers might have the means to buy full ownership but are constrained by the amount of holiday time they have to utilise their home at this point in time. So for them this is a savvy way of… Continue reading
