Tag Archives: yahoo
Over a quarter of prospective UK buyers not confident about mortgage applications
Some 28% of prospective buyers in the UK aren't confident their mortgage application will be approved first time and it is even lower among first time buyers, new research has found. Although 27% plan to seek professional advice, 32% have not yet taken any steps to raise their chances of mortgage approval, according to a new mortgage approval confidence index from Unbiased, an online financial advisor. Out of a possible 10 points, confidence among prospective homebuyers sits at 5.7, however, the research reveals that both confidence and success can be greatly improved through taking professional mortgage advice from an independent financial adviser, with 81% of advised applications being approved first time. The research suggests that 32% of UK adults are currently planning to buy a property, but 28% of those who plan to fund their purchase with a mortgage are not confident their first application will be approved. This figure rises to 38% among first time buyers. Many lenders have recently cut their mortgage rates, which is encouraging for prospective buyers, but the research shows these people are pessimistic about their chances of securing a loan, yet are doing very little to address this. The most common steps taken to improve the chances of mortgage success are checking credit rating (28%) and making a detailed analysis of all outgoings (25%), but 32% of prospective mortgage applicants say they have taken no action at all in this area. Although only 19% of prospective mortgage applicants say they have already consulted a professional financial adviser for help with their mortgage application, a further 27% say they plan to do so. Although first time buyers are less likely than other homebuyers to seek professional mortgage advice, many apparently come to appreciate the benefits of having help with their application. Mortgage advisers say people moving home make up 37% of their client base, compared to just 26% who are first time buyers. Overall, one in five potential buyers who seek advice from a professional mortgage adviser, do so after having had their initial non-advised application rejected. Men rank higher on the mortgage confidence index than women at six compared to 5.3, with 66% of men stating they are confident compared to 50% of women. Men are also more likely to have taken action to improve their situation, as 73% have already taken some steps compared to just 60% of women. Only 21% of women who plan to buy a property with a mortgage say they intend to reduce their spending to increase their chances of having their application approved, 40% have not done anything at all so far, and 33% say they don't plan to take any steps to improve their chances of success. ‘I's great that so many people are looking to get on the property ladder, and the recent spate of good deals from mortgage providers means this figure is likely to rise even higher. Having a concrete goal in mind such as… Continue reading
Confidence in US housing market rises, latest index shows
Confidence in the US residential property market is on the rise, especially among those renting homes, new research shows. More than five million renters say they're likely to buy a home in the next year, according to the latest Zillow Housing Confidence Index (ZHCI) and overall both renters and home owners expressed more confidence in the housing market this year than last year. Americans are most confident in the housing market in San Jose, Miami and San Francisco while over the last year, confidence rose the most in Dallas, Detroit and St. Louis. Home owners remain more confident than renters, but renter confidence is growing faster than homeowner confidence in 14 of 20 metro areas surveyed. A breakdown of the figures show that more than 12% of current renters nationwide, roughly 5.2 million, said they plan to buy in the next year, an almost 25% jump from the same time last year, when 4.2 million renters said they had plans to buy within 12 months. The ZHCI, sponsored by Zillow and developed by Pulsenomics LLC, polls homeowners and renters about housing market conditions, expectations for the future and their attitudes toward homeownership in general, across 20 of the large metro areas in the United States. Thanks to historically low mortgage interest rates and home values below peak levels, buyers can expect to spend about 15% of their monthly income on a mortgage payment, compared to 22% historically, according to Zillow research. Typical renters should expect to pay 30% of their income to rent, compared to 25% a generation ago. ‘As home affordability continues to look great and rental affordability looks abysmal, many current renters clearly seem to be re-thinking their attitudes toward homeownership, and are expressing more confidence in the overall housing market as a result,’ said Zillow chief economist Stan Humphries. ‘But while this confidence is heartening, it's important to inject a note of reality as not all renters who want to buy this year will be successful. Saving a down payment, qualifying for a mortgage and finding an affordable home to buy all remain formidable challenges for many,’ he explained. ‘Among all renters surveyed nationwide, 59.7% said they think buying a home is the best long term investment a person can make, compared to 56.9% at the same time last year. This improved long term outlook was especially evident among younger renters. Among all 18 to 34 year old renters, 66.2% said owning a home was the best long term investment, compared to 61.4% last year. The index is measured on a 100 point scale, with readings more than 50 indicating general confidence. Overall, housing market confidence is rising more quickly among renters than home owners. Among only home owners, headline confidence rose 3.7 points year on year, to 70.6 in January. Among renters only, overall confidence rose 4.4 points in the past year, to 62.4. Confidence among all owners and renters rose 3.6 points, to 67.4. Although survey respondents in most… Continue reading
Huge boost to first time buyers in UK with new deposit savings plan
Thousands of would be home buyers in the UK will be able to fulfil their dream of owning a property after the government announced a new savings plan to help them get a deposit. Chancellor George Osborne is introducing a new Help to Buy ISA which will allow them to save up to £200 a month towards their first home whereby the government will add a £50 bonus for every £200 saved up to a maximum of £3,000 per person. In his Budget Day speech he pointed out that the government has already helped tens of thousands of people to buy a home with Help to Buy, which allows people to purchase a home with just a 5% deposit. Effectively a tax cut for first time buyers, it will be introduced in the autumn and this, coupled with the news that inflation rates will remain low, is good news for those struggling to afford to get onto the housing ladder. It will provide a significant boost to the ability of a first time buyer to save speedily and effectively, according to Mark Hayward, managing director of the National Association of Estate Agents (NAEA). ‘This is exactly what is needed to engage the first time buyer market, particularly as we have seen the current criteria under the Mortgage Market Reform constraining aspirations to buy a home,’ he said. He pointed out that it especially benefits couples who are buying for the first time as both are eligible to open a Help to Buy ISA and it is also timely, considering house price inflation out paces wage inflation, so this additional boost to first time buyers savings pots will help them at least keep apace rather than fall behind the inflationary curve. The move has been widely welcomed by the property industry at a time when first time buyers overcoming the constraints of saving for a deposit has been one of the biggest barriers to home ownership. First time buyers are needed to keep the housing ladder moving. Lucian Cook, Savills UK head of residential research, also explained that limiting the ISA to a £12,000 savings plan with a £3,000 government contribution should prevent a surge in house prices. ‘It is more likely to help get buyers over the deposit hurdle in the lower value, lower growth markets of the Midlands and the North than say London and the South East, where significant constraints remain,’ he said. ‘ It is also likely to be welcomed by parents and grandparents by making first time buyers less dependent on the bank of Mum and Dad and more inclined to contribute some top up savings when children come looking for assistance to get on the housing ladder. However, those first time buyers who are keen to lock into low interest rates and who have access to parental support are unlikely to commit to what is effectively a five year savings plan,’ he added. According to Adrian… Continue reading
