Mortgage rates ‘at 2007 levels’

There are signs the mortgage market is recovering from the credit crunch

Mortgage rates are back to where they were in August 2007 at the onset of the credit crunch, according to research by price comparison website Moneyfacts.

The average rate on a two-year fixed deal is now 6.59% - almost the same as 6.56% in August 2007 and down from 7.08% in early July.

However, the costs associated with mortgages remain high, Moneyfacts said.

The better rates are only available to those with big deposits and lenders are also charging higher fees.

Moneyfacts said that the average mortgage arrangement fee was now £964 compared with £803 in August 2007.  Full Article

‘Turbulent times’ predicted for North East house prices

The North East has had the fastest increase in house prices in the past five years according to a new report from the National Housing Federation.

Jon Land for 24dash.com in Housing - Wednesday 20th August 2008

However the document - researched by independent economists Oxford Economics - forecasts a fall in house prices through to 2011. Prices will then rise rapidly creating further supply and demand problems.

The report, North East Home Truths 2008, shows that despite the ups and downs of the housing market the need for more social housing is greater than ever.

Looking Back

* House prices have risen 87% in the past five years, faster than any other English region.
* Since 1997 house prices have gone up 161% while average incomes have risen just 35%.
* Housing waiting lists grew 46% in the past five years and currently one in 12 North East households are on a housing waiting lists (more than the national average).
* Nearly 4,800 households were accepted as homeless in 2007.

Looking Ahead

* Prices will fall in the region through to 2011 (falling 5.1% in 2009 and 1.3% in 2010)
* Prices will then rise rapidly, growing 8.6% in 2012 and 9.6% on 2013
* The average house price in the region in 2013 will be £163,600, a 15% rise from 2007.
* The North East is projected to have the highest percentage growth in households aged 65 and over by 2026.

Full Article

Foxtons case leaves agents in limbo over renewals

The challenge to Foxtons, the London agents, by the Office of Fair Trading over the charging of renewal fees is continuing to have repercussions – which could prove costly – for agents all over the UK.

Estate Agent Today - 21 August 2008

The OFT announced its HIgh Court action earlier this year and immediately agents found that until the case is resolved, courts would not hear their own actions when trying to chase landlords for renewal fees.

One of the first to discover this was Fisks, of Essex and London, founded by John Pring.

Pring said that a landlord had been charged a renewal fee, as per the contract. “He put up what we felt was a rubbish defence, which he changed a few days before we went to court,” says Pring.

“His defence was that he had had an email from one of our members of staff saying that we would not be charging him a renewal fee. However, the email did not exist as the member of staff had already left our employment as we would have been able to prove. Full Article

Major HIP company collapses

The market slowdown has claimed another victim, Hipstar.

The HIP provider, based in Chertsey, Surrey, has gone into administration.

Estate Agent Today - 21 August 2008

Callers to the company are told that a liquidator is to be appointed and that anyone with queries meanwhile should email info@hiipstar.co.uk

Hipstar also had a significant franchise operation and is believed to have sold 92 franchises last year and 31 the previous year. It was still aiming to sell more franchises this year.

The company came late to the market, launching in March 2006. It aimed to be a major provider and was geared up to doing 150,000-180,000 HIPs per year. Full Article

LandlordZONE Newsletter - August 2008 - Student Lettings

Welcome to the July 2008 edition of the LandlordZONE Newsletter.

Problem Tenants - August 2008 Issue 32

Download the Full Newsletter

It’s hard to believe it’s 12 months since the long running boom in the housing market came to an abrupt halt.

The “credit crunch” suddenly froze the wholesale money markets around the world, practically paralysing the banking system.

It’s exposed those “too-clever-by-half”, and some would say “greedy”, banks and hedge fund managers, plus the “red-tape” bound regulators, for what they really are—the recriminations will go on for years.

With the effective collapse of several important banks and the resulting squeeze on their balance sheets there’s a palpable headlong rush back to reality.

As the tangled mess gradually unwinds inflated value is being sucked out of the system and a distinct possibility of recession.

Continue reading LandlordZONE Newsletter - August 2008 - Student Lettings…

Landlord fined £20,000 plus £35,000 costs for Gas Certificate

Carbon monoxide from untested boiler caused the death of six-year old girl

The Health and Safety Executive (HSE) is highlighting the fatal consequences of carbon monoxide gas following the death of a six-year old girl who was poisoned by fumes from a faulty boiler.

Hussein Jajbhay, director of property company Amadeus Investments Ltd, was fined £20,000 and ordered to pay £35,000 costs at the sentencing today at Blackfriars Crown Court, having previously pleaded guilty to two counts under the Health and Safety at Work Act 1974.

Bill Hazleton HSE Inspector said: “This tragic case emphasises the importance of maintaining and checking gas appliances. Carbon Monoxide gas is a silent killer, you cannot smell or see it. Landlords have a duty to maintain their gas appliances, and it is illegal and highly dangerous not to have them checked yearly by a competent, registered gas fitter. Currently, only CORGI is recognised by HSE to register gas installer.”

Six-year-old Elisabeth Giauque was living with her family in a rented house in Castle Close, Wimbledon. On 4 February 2005 her parents went out for the evening, leaving their three children in the care of the nanny. On their return they found Elizabeth unconscious in her bedroom. She was rushed to hospital where she died two days later. It was later established that she died from carbon monoxide poisoning.

Four days later, two other family members who had stayed overnight in Elizabeth’s room, collapsed and were taken to hospital. They were also found to be suffering from carbon monoxide poisoning.

It is the duty of the landlord to ensure gas appliances, boilers and flues are maintained in a safe condition. An annual safety check must be undertaken by a registered installer, who must provide a record of the inspection.

Hussein Jajbhay was the owner and landlord of the property at Castle Close. The last service and maintenance of the boiler at the property was carried out in January 2002. A landlords’ gas safety certificate was issued following an inspection in January 2003, which expired more than 12 months before the fatal incident.

Hussein Jajbhay pleaded guilty to two charges under 37(1) of the Health and Safety at Work etc Act 1974 for failure of maintenance and failure to maintain a gas fitting in a safe condition.

Press Release HSE

Rental demand lifts 76% as depressed housing market continues

Demand for rented accommodation in July grew by 76 per cent year-on-year, according to new data from estate agent Your Move.

Sharon Flaherty, FTAdviser - Friday , August 15, 2008

Lease commencements were up by more than three quarters in July this year compared to July 2007 as thousands of would-be house buyers scrapped plans to get on the property ladder.

On a month-by-month basis, tenant demand is also rising with the number of leases commencing in July this year up 18 per cent from June.

According to Your Move, landlords have experienced the strongest demand from tenants for decades, as property purchases slide and the ongoing mortgage drought prevents people from buying.

Managing director of Your Move David Newnes said: “Demand for rented accommodation has exploded – July’s massive uplift is the biggest this year. Full Article

A borrower’s survival guide: CML, Citizens Advice and Shelter

Household finances have been badly stretched in the past year as the cost of energy has increased by 17% and the cost of food by 12%*. And the credit crunch means that the cost of new mortgages has increased, there are fewer mortgages available to choose from, and they are more difficult to obtain.

A borrower’s survival guide: CML, Citizens Advice and Shelter - 15 Aug 08

This is making life harder for the 1.4 million borrowers coming off cheaper, fixed-rate mortgages in 2008. But there are ways to help yourself and organisations to help you cope if you are struggling, according to the Council of Mortgage Lenders, Citizens Advice and Shelter.

No matter the size of your financial problems there are steps you can take to tackle them, and the CML, Citizens Advice and Shelter have worked together to come up with ten tips to help struggling households get through the tough times.

1. Get talking

If you are worried about your finances your first move should be to start talking: talk to your lender, talk to your partner, and talk to a free, independent debt adviser. The earlier you tell your lender, the more options available to solve the problem. Options that your lender may consider include: extending the term of the mortgage, changing the type of mortgage, deferring interest payments for a short period, and treating the arrears as part of the original debt.

Continue reading A borrower’s survival guide: CML, Citizens Advice and Shelter…

Law Commission - A new era for the private rented sector

As the third and final part in its series on housing law reform, the Law Commission today announces its proposals for better regulation of the private rented sector.

The report, Housing: Encouraging Responsible Letting, follows wide consultation with both landlords and tenants. It focuses on improving the overall coherence and stability of the current private rental framework in a cost-effective way.

Based on the principles of smart regulation, the Commission recommends a programme of staged reforms designed to promote self-regulation and enhance voluntary initiatives already in place in England and Wales. The proposals include

Creating a housing standards monitor (for each of England and Wales) for the private rented sector

Establishing an associated stakeholder board to which representatives of all sides of the private residential rented property sector are appointed

Developing a single code of housing management practice for landlords

Launching a pilot programme for home condition certificates

Continue reading Law Commission - A new era for the private rented sector…

Law Commission Proposed Changes in Private Renting Sector

Encouraging Responsible Letting

Recommendations:

On 14 August 2008 we published our final proposals on better regulation of the private rented sector in the report Housing: Encouraging Responsible Letting. A press release is also available.

The project, which arises out of our previous work on housing law reform and tribunals, aims to identify and address regulatory challenges in the private rented sector. This is the first project undertaken jointly with the Welsh Assembly Government (housing is a policy area devolved to the National Assembly for Wales).

This project is not proposing major changes to the law. Rather, it examines ways in which the current law can be made more effective. There is a great deal of law that applies to the sector, but much of it does not work as Parliament intended. As a result, the standards set by the law are often not met, particularly in relation to the physical condition of housing. In turn, these failures contribute to the sector suffering from a poor reputation which, arguably, gets in the way of it playing as full a part as it should in providing housing.

The report recommends a programme of staged reforms based on principles of smart regulation. Following responses to our consultation paper, we propose a system of self-regulation designed to enhance voluntary initiatives already in place, leaving open the option of future reform to create a compulsory system. It is intended that implementation of our proposals would harmonise and simplify of the current system in an affordable way, with benefits to both landlords and tenants.

Find more details here