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More accessible lending for first time buyers in UK confirmed by latest data
There has been an increase in the UK to borrowers with smaller home deposits due to increased accessibility in lending and highly attractive mortgage rates, the latest mortgage market report suggests. Loans to borrowers with small deposits, typically first time buyers, saw a year on year increase in April of 7.3% and were up 6.4% month on month, according to the data from e.surv chartered surveyors. However, the number of house purchase approvals fell year on year, suggesting that higher LTV lending is helping to support total mortgage approval figures. In the total market, there were 1.9% fewer approvals for house purchase loans in April than there were last year: 62,035 loans, down from 63,236 in April 2014. As a proportion of total approvals, higher LTV lending now stands at 16.3%, compared to 15.5% in March and 14.9% in April last year. These gains come despite a poor start to the year, the report points out. ‘This revival of the bottom of the market is becoming ever more crucial and this showed in the recent election struggle, with all the main parties placing helping first time-buyers as one of the crucial components of their campaigns,’ said Richard Sexton, director of e.surv. ‘However, before concerns are raised regarding the increase in higher LTV lending, it’s worth putting these numbers in context. The number of higher LTV house purchase approvals is still only a quarter of what it was in 2007. This is a healthy upturn in higher LTV lending, not a symptom of any malady in the mortgage market,’ he explained. ‘Prime Minister David Cameron has outlined a plan to provide 200,000 cut price starter homes, alongside a commitment to unlocking brownfield land for building new homes. This is the kind of clear planning the property market needs and it is to be hoped that the proposals crystallise into real policies,’ he added. The data also shows that on a monthly basis, house purchase approvals increased 1.1% from March, when there were 61,341 house purchase loan approvals. Despite a small month on month drop in March, this is the latest piece of a clear trend of growth stretching back to December last year. Sexton pointed out that in the wake of mortgage reforms a year ago there were five consecutive months of dips. ‘We turned a corner at the start of this year, and lending is starting to find its feet again in the new regulatory landscape. This should be even more of a spur to the government to push forward their plans for home building, as a continual demand for home ownership places ever more pressure on Britain’s insufficient stock of homes,’ he said. The proportion of higher LTV lending has either increased or remained stable in most UK regions in April but Scotland saw just 12% of house purchase approvals for borrowers with smaller deposits in April, compared to 16% in March. At the other end of the spectrum, house… Continue reading
Most home owners in UK who build an extension want a bigger kitchen
Rear and side extensions have become the most popular way for home owners in the UK to increase the size of their property, new research shows. Some 31% of those who have extended their home in the last two years opted to build on the side or behind and most wanted a bigger kitchen, according to the study from Sainsbury’s Home Insurance. Conservatories are the second most popular residential extension accounting for 29%, followed by loft extensions at 15%, garage conversions at 11% and the construction of an outbuilding such as a garden room or home office at 5%. Of those who have undertaken home extensions in the past 24 months some 25% have added between 11 and 20 square meters of additional living space to their homes, while 23% have added 21 to 30 square meters and 18% have added 31 square metres or more. Amongst builders surveyed for the research, rear extensions were the type of home extension most frequently carried out, with 92% of builders having completed one in the past 12 months. These were followed by side extensions at 72%, loft extensions at 54% and garage conversions at 41%. The findings indicate a trend towards families spending more time in larger kitchens where they cook and eat together. According to the builders’ survey bigger kitchens and kitchen diners were the most frequent reason cited for a home extension, with 84% of builders having worked on these. The second most popular intended use for the new space was for additional bedrooms, accounting for 61%, followed by new bathrooms and home offices at 53% each. ‘For those who are improving and extending their homes, it’s crucial to advise their home insurance provider. Making revisions to a property such as adding new rooms could change the value of the property significantly and failing to report alterations may see people left under-insured or with invalidated insurance policies,’ said Tom Thomson of Sainsbury’s Home Insurance. Continue reading
New Zealand sees strongest new home figures for almost a decade
New building consents in New Zealand have increased to the country’s strongest house building rate for nine years, according to the latest official figures. Housing supply is increasing particularly in Auckland and Christchurch, according to Building and Housing Minister Nick Smith, with 25,000 plus new consents per year nationally. The latest annual figure of 25,038 compares to the low of 13,236 following the global financial crisis. A breakdown of the figures shows there were 756 new building consents for Auckland in March, which compares to just 209 per month before and 7,940 building consents in the year to March 2015 in Auckland, the highest since 2006. ‘We are well on the way to recovering the 10,500 homes lost to the earthquakes in Canterbury, with another record set for building consents. The 588 consents issued last month confirms the Government's view that the Christchurch housing market will have supply and demand back in balance by 2017/2018,’ said Smith. ‘These positive signs follow a general pattern of strong growth that has continued for almost four years. They confirm the latest GDP data showing a $9.5 billion annual investment in residential construction – an all-time high. It shows that the Government's programme of measures to increase housing supply is working,’ he added. Smith also pointed out that there are now Housing Accords in place with six local councils to free up more land faster. ‘We have initiatives in place to constrain building materials costs, rein in development contributions, cut compliance costs and invest in improved sector productivity,’ he said. He explained that the new $435 million HomeStart support package, which came into effect 01 April, is projected to assist 90,000 people into home ownership. ‘This is good progress but with strong net migration data from fewer New Zealanders leaving, we need to keep doing more. The next steps in our programme include our planned second phase of reforms to the Resource Management Act and place based initiatives like those announced today at Tamaki. The Government remains committed to supporting more New Zealanders into their own home,’ he concluded. Continue reading
