Archive for May, 2008
Friday, May 30th, 2008
Slightly better news for hard pressed buyers is the return of that endangered and maybe even thought to be extinct animal – the 100% mortgage. The Bank of Ireland have stepped back into the market with a 100% loan product. Sandy McFarlane – long time mortgage advisor at Caesar and Howie, cautiously welcomes the news. “It is encouraging to see some better news for buyers. However – folk shouldn’t get carried away just yet. This is a niche product with fairly strict requirements including having a guarantor. So the product will have a limited market I think – but it will still get some first time buyers back in buying mode. And who knows – once one lender comes back in maybe others will follow.”
If you wish to know details of this or any other mortgage product currently available – call Sandy on 01506 815900.
Tags: mortgages
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Tuesday, May 27th, 2008
The momentous decision taken by the Law Society of Scotland to allow new business models for legal firms has been warmly welcomed by Caesar and Howie. The changes which will probably take about three years to come into force will allow Law Firms to be owned or part owned by non -lawyers. At the moment only lawyers may own their firms and they cannot work as part of a wider company or partnership.
Some commentators have suggested that this change will cause the demise of the local “High Street” lawyer.
However David Borrowman – managing partner of Caesar and Howie sees things differently. “This I see as a great opportunity for our firm – not a threat. We have been expecting this decision for some time and we have been working to ensure we are ready to take the opportunities which it brings. We have excellent expertise in various areas of our work and we are sure if others wanted to work with us they would bring in their expertise to the mix. The bottom line is to ensure our clients enjoy the best service we can give them and if that means working in a different way with new techniques and in new structures we are very much up for that”
David continues “The Law Society will insist in their forthcoming work, that any new structures must contain safeguards to ensure no conflict of interest can arise and that lawyers must continue to put clients interests first. Provided that ethical framework remains think how firms law could be transformed for the better by the injection of new investment, new ideas, and modern marketing methods. The next few years will be challenging and interesting times for us all”
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Tuesday, May 27th, 2008
Never has the “House Market” been more in the news than it is now. But so far all the articles I have seen are about houses as a financial investment and whether prices will go up or down. Generally the slant on these articles seems to be it is bad news for prices to go down and good news for them to go up. Certainly there are many in the market to make money one way or another but perhaps many commentators miss the fact that this is a market mostly for homes for families and individuals. This is not a straightforward commodity market. It therefore seems to me that most buyers want a suitable home first and foremost with the secondary hope that it might appreciate in value somewhat over their lifetimes. Long term social trends in this country with smaller, different and more regularly changing family units would tend to suggest a move over time towards more households. Similarly increasing longevity and immigration would seem logically to add through time to housing need. So my feeling is that subject to fluctuations here and there the probable long view is that houses should appreciate in value.
If that is right buyers and sellers alike should not lose confidence in the market but respond sensibly to what seems to be happening in the short term. Currently in the short term the house market looks to be becoming a little smaller with fewer transactions taking place – and to have changed from the rampant sellers market of the last few years to a buyers one – where what pressure there is on prices is downwards.
In this scenario if you start looking at the market from the “home” perspective things look a bit different and more encouraging than perhaps most current commentators are saying. For example newcomers to the market will gain should prices fall. Again if someone owns a property and wants a bigger one – things get better if prices drop. Say prices drop 5% and your were intending selling at say £150 k and buying at about £250k your sale price drops by £7500 but your purchase price drops by £12500 – so you gain – and the higher up the scale you are the more you gain. Usually people trading up are doing so to accommodate the arrival of new member of the family – they are not moving just to make money. Losers in a market where prices are falling would be people trading down – but these tend to be older people who have been in their house a long time and whose mortgages are paid off. So the loss here is generally a paper one anyway as opposed to an actual loss of cash.
Possibly the only real losers may be those who buy with a large mortgage and have to move or sell at a time outwith their control when prices are falling. They may have just bought – then lost their job or have to move job forcing them to sell. This group would suffer on a price fall – but how many homeowners come into this category – probably not very many.
My feeling is that long term prospects remain good in this market, but care must be taken because of the short term buyers market we are in. The short term difficulties are causing delayed sales and creating English like chains where deals are not finalised till the last minute. For sellers that mean selling before you buy and even being prepared to take temporary accommodation before completing your purchase. It also means being patient in the sales process and completely sensible on prices. For buyers it means not paying too much now and also not buying in the hope that a quick sale on can deliver a profit in no time – that will not happen. It means leaving a little spare in the budget to cope with mortgage costs maybe rising. Finally It also means being prepared to see your new property as first a suitable home for you and your family now and only over time a financial investment.
Tags: housing market
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Monday, May 12th, 2008
The Scottish economy is being buoyed by the housing market, it has been claimed.
According to a forecast released today (May 12th) by the Bank of Scotland, the economy will see an upturn in growth next year, the Scotsman reports.
Factors contributing to Scotland’s economic growth include consumer confidence, good car sales and a healthy housing market, the news source states.
Martin Ellis, chief economist at the Bank of Scotland, explained that the historically low interest rates “continue to fuel strong demand for new housing”.
This was indicated recently in the Bank of Scotland House Price Index, which showed that the average Scottish property price had increased by 20 per cent to £82,000 during the past six months, while Edinburgh was found to be the most expensive place to buy a house in Scotland.
Furthermore, Edinburgh was found to have sold the most million pound properties in the northern regions of the UK in a recent Halifax study.
Tags: economy, property, Scotland
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Monday, May 12th, 2008
For those hoping to buy a house in Edinburgh, new statistics from Halifax may be welcome news.
According to the Halifax Estate Agents Million Pound Property Report, Edinburgh witnessed the largest number of million pound property sales in the northern regions of the UK in 2007.
The bank states that 148 such properties were sold in that time, which was 86 per cent higher than Macclesfield which had the second highest number. Over all, million pound property sales increased by 36 per cent in the UK.
However, as Gordon Edwards, managing director at Halifax Estate Agents, explains, there was even more success south of the border.
“Although there has been a marked increase in the number of million pound property sales over the past decade, a small number of local authority areas in London continue to account for the significant majority of £1 million sales,” he said.
Over the past year, the biggest house price increases have been experienced in Scotland, which may be of interest to those looking to buy a house in Scotland, with an increase of 5.3 per cent, the Halifax House Price Index recently revealed.
Tags: Edinburgh, property
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Monday, May 12th, 2008
Scottish first-time buyers looking to buy a house in Scotland may be pleased to hear that they may be immune to the rise in repossessions experienced throughout the UK.
According to Firstrung, people stepping onto the housing ladder for the first time may be able to weather the storm of repossessions currently being experienced in the UK.
Not only have many first-time buyers taken out an average mortgage of £115,000, but it is often shared between two people, making it easier to manage, Paul Holmes, operations director of Firstrung explained.
Mr Holmes stated that family homes, such as those with mortgages in excess of £250,000 may be more at risk, yet the circumstances for people only just getting into the housing market should remain stable.
“First-time buyers are the least likely group to be repossessed full stop, because it is their home, they have recently bought it and they can generally afford it,” he said.
It was recently recorded that a rise of 16 per cent has been experienced in the number of possession claims during the first quarter of 2008 by the Ministry of Justice.
Tags: First-time buyers, repossessions
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Friday, May 9th, 2008
People hoping to buy a house in Scotland may be interested to know that one industry body has called for more interest rate cuts from the Bank of England.
Convex.net, a company of online property conveyancers, has claimed that the Bank of England should take further measures to bolster the housing market.
Duncan Samuel, managing director of the organisation, commented that the lack of activity of lenders is having an adverse effect on the market.
“It is clear that very soon the Bank of England will need to do something to bring the Libor rate down to free up mortgage funds,” he said.
This follows the Bank’s decision yesterday (May 8th) to maintain the base interest rate at five per cent.
The decision met with disappointment among several industry bodies, including the Royal Institute of Chartered Surveyors, which stated that the fact that housing transactions have recently collapsed and that consumer confidence has reached new lows needs to be remedied.
Tags: interest rates, Scotland
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Thursday, May 8th, 2008
The Scottish housing market is still feeling the impact of the slump in house prices throughout the rest of the UK, it has been claimed.
In a report that may be of interest to househunters hoping to buy a house in Scotland, Teresa Hunter, writing for Scotland on Sunday pointed out that Scottish buyers still have to “borrow from the same pool of mortgages”.
She stated that although Abbey and the Bank of Scotland have ‘trimmed’ their deals recently, prices remain high and may do for some time.
“Undeniably the market is slowing, and I’m not convinced Scotland can remain immune, although it may sidestep the excessive price corrections already evident in some overcooked hotspots in the south,” she said.
However, the figures appear to disagree, with the March Halifax House Price Index indicating that over the last ten years Scotland has experienced a 271 per cent increase in house prices.
Tags: credit crunch, housing market, Sottish buyers
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Thursday, May 8th, 2008
Those hoping to buy a house in Scotland may be interested in the advice offered by a housing industry expert over buying with unsecured loans.
Iammoving.com has advised homebuyers against using unsecured loans to buy property in the current market.
Peter Beckett, business development director, said that this is particularly relevant for people stepping onto the housing ladder for the first time, which may be significant to Scottish first-time buyers.
He said: “The whole housing market is at quite a turning point I think, whereby the prices are coming down and first-time buyers are looking for ways to be able to manage to get on to the ladder.”
Mr Beckett went on to say that unsecured debt is a “dangerous” option unless the house-buyer is “extremely confident” about their job security.
Gross lending in the UK slowed by eight per cent in the first quarter of 2008, according to the Council of Mortgage Lenders.
Tags: debt, First-time buyers
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Thursday, May 8th, 2008
Housing market experts have today (May 8th) expressed their disappointment over the Bank of England’s (BoE) interest rate decision.
In news that may be of interest to those looking to buy a house in Scotland, the BoE’s Monetary Policy Committee has decided to maintain the official bank rate paid on commercial bank reserves at five per cent.
According to the Royal Institution of Chartered Surveyors (Rics), this may not be good enough to rectify the current economic chaos.
“The Rics is disappointed that the MPC chose to leave the base rate on hold today,” says Simon Rubinsohn, chief economist at Rics.
“Housing transactions have collapsed, consumer confidence has sunk to its lowest level since 1992, the service sector appears close to stagnation … and the retail sector is under immense pressure,” he added.
Furthermore, SmartNewHomes.com has commented that the UK is in need of another base rate cut, going on to claim that lenders should take up the BoE liquidity scheme in order to boost UK lending.
Tags: interest rates
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