Reeds Rains Property Blog

Property News from Reeds Rains

Scottish House Prices Fall £1,724 in August

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The August 2012 Scottish House Price Index from LSL Property Services/Academetrics has been released today, providing a measure of the average house price in Scotland for August 2012.

  • Steepest monthly fall since March 2009 as exceptional wet weather takes its toll
  • Prices fall 2.1% compared to August last year. Back to weak 2009 levels
  • Prices in Edinburgh up £4,896 in the past 12 months

Data from the Scottish House Price Index for August 2012.

Richard Sexton, Director of e.surv chartered surveyors which is a part of LSL, comments as follows in the latest Scottish House Price Index from LSL Property Services/Academetrics published 17th October 2012.

“The market hasn’t suddenly become a lot weaker. First time buyer numbers are up 9% so far on last year, demand is still strong, and high loan-to-value mortgages are more widely available. August should prove to be just a blot on the copy book of recovery.

“Areas of Scotland were deluged with twice the normal amount of rainfall, which discouraged plenty of second time buyers from going out and viewing properties. And the Olympics took up people’s spare time. Lots of potential buyers will have put their property search on hold for a few weeks and used their leisure time to watch the sport. This may be why sales were down 6% on July.


“In the longer term, the feeling around the market at the moment is one of cautious optimism. This year has seen a tentative recovery in first-time buyer numbers. But it is a fragile recovery which could easily be shattered by a sharp downturn in the economy. And if the Eurozone crisis flares up again mortgage lenders will have their hands burnt, which will make it much more difficult for first-time buyers to get a mortgage.

“Things were more varied on a regional basis. Prices in Edinburgh continue to rollick along, thanks mainly to the greater number of wealthier buyers who live in the capital. In less affluent areas, fewer buyers have been able to meet mortgage finance requirements, which has reduced sales levels and dragged down prices as a result.”

Come Dine With Terry

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Terry Robinson, Sales Director for Reeds Rains Estate Agents in Leamington Spa and Kenilworth is to appear on the Channel 4 TV programme Come Dine With Me.

When not selling properties, Terry, who has been a local estate agent for over a decade, is also a very keen chef and spends lots of time cooking and hosting dinner parties.

Terry commented: “I have always loved cooking and eating in good restaurants. I love trying new dishes and so when the opportunity came up, I couldn’t say no!”

“I have made four great friends (yes we really did get along) and it was a wonderful experience so I am looking forward to it going out on TV.”

Reeds Rains' Terry Robinson

The five dinner parties will be shown at 5:30pm each night next week, 22nd to the 26th of October, with Terry hosting the second night on Tuesday with a rather interesting theme.

To mark this occasion, Reeds Rains Estate Agents in Leamington Spa and Kenilworth are offering a 50% discount on their standard fees for anybody that books a valuation between the 19th and 27th of October 2012.

Article featured in Warwick Courier on 20/09/2012 @Warwick_Courier

Ask The Expert - With Reeds Rains' Hannah Gretton

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A few years ago, the government introduced a new scheme that aims to protect the deposits tenants have paid to their landlords.

But research from the charity Shelter claimed that the majority of UK tenants remain unaware of their rights when it comes to such initiatives, with disputes over deposits having risen sharply in recent years. Current rules state that any deposit paid to a landlord by a new tenant must be put into a protection scheme within 30 days of the start of the tenancy. With the economy slowly recovering from what has been a difficult few years for the property sector, some local estate agents have unfortunately gone out of business - something which has added to the growing concerns help over the protection of tenants' deposits. But what else is there to know about such protection schemes and what steps can tenants take to ensure they get their deposit back in full?

This week's expert, Hannah Gretton, Branch Manager of Manchester's Reeds Rains estate agents, gave us an overview of such schemes and explained why they were brought into effect:

Reeds Rains' Hannah Gretton

Since April 2007, deposits taken for tenancies that are AST's (assured shorthold tenancies) under the Housing Act 1988 must be protected by one of the Tenancy Deposit Schemes. This means that, if held by the agent, the deposit will be help in the capacity of a stakeholder. There are two types of approved schemes, either the custodial scheme (DPS - Deposit Protection Service) or an insurance-based scheme (MyDeposits and the TDS - Tenancy Deposit Scheme). Deposit schemes were brought in as legislation under the Housing Act 2004 covering deposits on AST's to promote good practice in deposit handling, assist in the resolution of disputes relating to deposits, and encourage landlords and tenants to make a clear agreement at the start of the lease about the condition of the property.

Inventories and schedules of conditions are not mandatory. However from a landlords' point of view, it will make any claim for damages against deposits at the end of the tenancy much easier to establish if there is an inventory and schedule of condition.

If there are any disputes at the end of a tenancy, and the landlord and tenant cannot agree where the deposit monies are to go, an independent adjudicator will look at all the evidence provided and make a final decision on what proportion of the deposit will go where. So the need for an accurate and detailed in-going inventory and out-going check out vital.

Tenants are expected to behave in a 'tenant-like manner' which means tenants are expected to take reasonable care of the property and have an obligation not to commit waste (damage of the property). Fair wear and tear will be allowed which means tenants are not responsible for dis-repair that occurs as the fabric and fittings age, as long as the property is being used in a tenant-like manner. The property should be returned in the condition it is given at the start of each tenancy, as long as tenants adhere to their obligations under their tenancy agreement then the full deposit should be returned once the tenant has moved out and within the required timescales under the protection laws.

Shelter has launched a deposit scheme tracker to check if your money is safe. Visit england.shelter.org.uk for more details. You can also gain information from Citizen's Advice at citizensadvice.org.uk.

Article featured in Urban Life 11/10/2012 @UrbanLifeMcr

Home Loans Fall 7% In September As Funding For Lending Fails To Boost Market

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The latest e.surv mortgage monitor, published Friday 12th October, provides a review of the mortgage market.

  • House purchase loans fall to 47,603, 3rd worst September on record
  • Tightening lending criteria drives fall in high LTV lending
  • Average loan-to-value falls to lowest since January 2011
  • Less than 5,000 purchase loans granted to buyers with a deposit of under 15%
  • But lenders say FLS will boost lending significantly in Q4

House purchase loans in September fell 7% year-on-year to 47,603 – the third worst September since records began in 1993 – as improved credit availability for lenders failed to translate into an improvement in lending, according to research released this morning

The latest Mortgage Monitor, produced by e.surv chartered surveyors, found the fall in loans was steepest among high LTV borrowers – typically first-time buyers. Loans for house purchase fell across all LTV bands and house price brackets, suggesting the government’s Funding for Lending Scheme (FLS) is yet to make a telling impact on the mortgage market.

The average LTV on a house purchase loan in September fell to 59%, its lowest since last January, reflecting the sharp fall in loans to borrowers with small deposits. Just 1 in 10 of all house purchase loans went to borrowers with an LTV of 85% or over, continuing a three month trend. The number of loans to borrowers with a deposit of less than 15% has now fallen below 5,000 for the last three months. The last time that happened was between May and July last year.

Richard Sexton, business development director of e.surv, explains: “September isn’t just a one off. The mortgage market has been struggling since early June, and is considerably weaker than it was this time last year. The period between August 2011 and May this year marked a real upturn in lending. But that fillip planted false hope. Since then, the effects of the double dip recession have sapped the confidence lenders have in the economy. That, combined with a squeeze on the funding lenders get from the money markets, has dragged down lending. Criteria on high LTV mortgages have become more restrictive, and this has choked off first-time buyer lending.”

Despite 18% more mortgages with an LTV of above 85% on offer since April 2011, and lenders reporting an improvement in mortgage credit over Q3, fewer borrowers have been able to access high LTV loans because of toughening lending criteria. The apparent contradiction between more LTV mortgage products on the market and a fall in lending suggests lenders are not yet confident enough in the economy to increase lending to borrowers with low deposits and low incomes significantly.

September marks the fourth consecutive month of a year-on-year fall in house purchase lending, suggesting the market is significantly weaker than it was this time last year. Lending in Q3 was 7% lower than the equivalent period last year, with 11,019 fewer house purchase loans. To illustrate the extent of the decline, house purchase lending in September is 10% lower than September 2009 – when the market was still in the grips of the financial crisis.

Positive Signs Ahead

The picture was brighter on a month-on-month basis, with house purchase loans in September falling by a marginal 0.1% compared to August.

Richard Sexton explains: “Analysts have been quick to criticise the Funding for Lending Scheme after an inauspicious start in August, but it will prove to be a slow-burn. The Bank of England’s latest credit conditions survey suggests an improvement in house purchase lending may be on the horizon. Lenders told the Bank the availability of secured credit will increase ‘significantly’ over the fourth quarter, and specifically referenced the Funding for Lending Scheme as a key driving the improvement. Lenders say it has helped increased their mortgage funds by 36%, the biggest increase since records began. If it is a slow-burn, FLS will begin to translate into higher mortgage lending in the fourth quarter, which will help more first time buyers get a foot on the ladder.”

House Sales Fall As Prices Dip During September

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The September 2012 England and Wales House Price Index from LSL Property Services/Academetrics has been released today, providing a measure of the average house price in England and Wales for September 2012.

  • Transactions fall 24% in September as a knock-on effect of Olympic distraction
  • House prices drift down 0.1% on monthly basis
  • Annual house price increase slows to 2.2%

Data from the England and Wales House Price Index for September 2012.

David Newnes, Director of LSL Property Services - owners of Your Move and Reeds Rains - comments as follows in the latest England and Wales House Price Index from LSL Property Services/Academetrics published 12th October 2012.

“A combination of dipping house prices and falling sales numbers point to a slowing market in September as a lethargic mortgage market and the knock-on impact of reduced buyer activity in August took its toll during the month. House prices are still in positive territory this year, and have increased on an annual basis for six consecutive months due to a shortage of properties on the market alongside the ongoing appetite from cash buyers and those with substantial equity. However, the rate of increase is slowing.

“It’s clear that the September housing market was still feeling the effects of the distraction of the Olympics in August, with lower activity and reduced competition in the previous month feeding through into a lower number of sales in September. In fact, transactions fell by 24%, compared to a typical seasonal monthly fall of 9%. While we have already started to see buyer activity rebound, the short-term factors hampering September’s performance shouldn’t mask the wider problems the national housing market faces. The lack of lending, especially to first-timer buyers, is choking off first time buyer sales outside of prime London, while uncertainty over job prospects in many parts of the country is still affecting sentiment of many prospective buyers.

“Much hangs on an improvement in the mortgage market. We’ve yet to see enough time elapse to feel a substantial impact from the Funding For Lending scheme in sales prices and numbers, or a boost to activity at the bottom end of the property market. However, lenders are confident that it will lead to increased funding for home buyers, and expect credit availability to increase significantly in the final quarter of the year, according to the Bank of England’s latest Credit Conditions Survey. If this is the case and the cheaper finance reaches those waiting to purchase their first home, it could provide a welcome new impetus for transactional activity, and a new source of optimism for would-be buyers.”

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