Reeds Rains Property Blog

Property News from Reeds Rains

All You Need to Know about MMR

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In April all lenders were required to change the way that they assessed residential mortgages.  Historically lenders had used simple multiples of the applicant’s income to dictate how much they would lend and although underwriting had become more complex with other factors taken into account there was still a focus on the “top line” of applicants income.

 On the 26th April this year, all that changed and lenders were required to look at the customer’s ability to make the payments, not just at the current pay rate but also at a notional figure taking into account the fact that rates are likely to rise in the short to medium term.

At the time there was a great deal of scaremongering that went on, thankfully, whilst the scrutiny that lenders do apply to potential mortgage applicants has risen most of the scare stories have proven unfounded.

What has become clear however is that consumers still don’t really understand how the changes apply to them.  A recent survey by TSB showed that only 51% of aspiring homeowners had even heard of the Mortgage Market Review (MMR), which by consequence means that almost half of people looking for a house don’t understand, or in some cases even know about, the changes.

MMR is primarily designed to ensure that people only borrow what they can reasonably afford to repay so it is encouraging to read in the same report, that 41% of those who were aware felt that the rules would ensure this.

As with most things getting professional advice is always a great starting point; borrowers have to remember that this is almost certainly going to be their largest purchase and for most people is their single largest outgoing each month, so getting good advice, listening to that and acting on it is a sound idea.

There are a number of things that can be done in preparation for that meeting and we always advise our customers to have taken time to prepare a few basics before coming in to see an adviser;

·         Think about your expenses after you have moved, these will likely to be different to where you currently live and certainly will be significantly different for those who are still living with parents.

·         Document these expenses and look at what is left over to pay a mortgage and the associated protection policies.

·         Start saving as early as possible, even if it isn’t a huge amount each month

·         If you have had financial difficulties in the past get a copy of your credit report. This won’t necessarily stop you getting a mortgage but may mean that an adviser has to look at different option.  Non disclosure of any historic financial problems is viewed very badly by lenders so be very upfront about the problems and the reasons for them

·         Check that you are on the electoral role, if a lender can’t find you, they are unlikely to want to lend you money.

By John R Hargreaves, Financial Services Director, Reeds Rains Estate Agents

 

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

An administration fee of £499 will be payable when you sign the professional fee agreement upon mortgage application.

Reeds Rains features on hit TV programme Phil Spencer: Secret Agent

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Left to right - Phil Spencer: Secret Agent with Reeds Rains Waterlooville Branch Manager Martin Archbold

Reeds Rains in Waterlooville are delighted to feature on the TV programme Phil Spencer: Secret Agent where they have successfully sold a property where other agents had been struggling. The three bedroom terraced house had been on the market for 6 months before Reeds Rains found the right buyer and completed the sale on the property for £179,995.

In the TV programme, Phil Spencer features the house and acts as the sellers "secret agent", viewing the property without them present and preparing his own alternative set of sales particulars, entitled "The Brutal Truth", designed to show why the property is not selling. The owners then have a week to act on Phil's suggestions before hosting an open day for buyers.

Waterlooville Branch Manager Martin Archbold comments: “We are delighted to be featured on this programme as it is a real testament to the professional way Reeds Rains delivers proficient customer service, specifically tailored to what the customer wants to achieve. This is one of the reasons we are seeing lots of buyers, sellers, landlords and tenants come to us for advice. We worked with Phil on arranging the open day and provided potential buyers to view the property, all who were keen and interested in making an offer. We were thrilled to sell the property which had been on the market for six months before it came to us.”

If you would like to find out how Reeds Rains in Waterlooville can help you buy or sell your property then visit the branch website or call 02392 254321 (*) for more information.

(*)Calls may be recorded for training and/or monitoring purposes.

Buy-to-let index July 2014

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Rent rises creep above inflation for first time in over a year

  • Annual rent rises increase to 2.0%, fastest since September – but still only 0.1% after inflation 
  • Rents return to levels last seen in November 2013, standing at £753 per month in July 2014 
  • Tenant finances improve with 7.3% of rent in arrears, down from 7.8% in June and 8.1% last July 
  • Landlords see total returns moderate, down to 10.3% per annum as property price rises cool 

 Rents have risen in real terms for the first time in fourteen months, according to the latest Buy-to-Let Index from LSL Property Services plc, which owns the UK’s largest lettings agent network, including national chain Reeds Rains. 

The average residential rent across England and Wales is now 2.0% higher than in July 2013, currently standing at £753 per month. This is the same absolute level as in November 2013, and is up from an average of £738 per month in July 2013. 

The average residential rent across England and Wales is now 2.0% higher than in July 2013, currently standing at £753 per month. This is the same absolute level as in November 2013, and is up from an average of £738 per month in July 2013. 

David Newnes, director of estate agents Reeds Rains, part of LSL Property Services, comments: “As the summer turns to early autumn, the rental market is approaching its busiest period – yet rent rises remain modest. 

“Tenants looking to rent a new property this month still need to budget the same as they would have in November. At a time when the UK is facing a serious shortage of homes, and with purchase prices rising steadily, that is an immense achievement for the private rented sector. 

“Rents have tracked inflation for many years – and as of July remain down 0.2% in real terms since the start of 2010. This is testament to serious improvements in the supply of new homes to let, thanks to investment by landlords. If that investment keeps flowing, and the right incentives for new landlords remain, this positive trend should continue.”

Read the full buy-to-let index here.

Joe Dale is Acomb Cricket Clubs player of the month for July

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Reeds Rains Branch Manager Andy Jacques with Joe Dale, Acomb Cricket Clubs player of the month.

Reeds Rains is delighted to announce Acomb Cricket Clubs player of the month for July. The player of the month Award recognises an individual player from the Acomb Cricket Club who has demonstrated outstanding performance for the club.

Congratulations to Joe Dale on successfully winning the award for July. Joe played 3 times for the 1st 11 during the month of July (1 game rained off).  He scored 3 successive half centuries; with a match winning 58. He has also been successful with further scores of 73 against Sessay, and 72 against Pickering taking catches and wickets along the way. Joe also enjoys supporting All Out Cricket Coaching in York, and helps by coaching boys and girls across all ages and abilities.

The Acomb Cricket Club, which is in division one of the local league, is a family orientated club with history dating back to 1925 with teams in the York & District Senior League, the York Vale League as well as the Pilmoor Evening League.

Andrew Jacques is the Acomb branch manager for Reeds Rains who works alongside the club. He comments: “Joe has worked hard and achieved some great results and we are delighted to be able to offer support by sponsoring the local cricket club.  Joe is a very capable player with lots of talent and commitment who is willing to share his experience with others, especially the next generation of young cricketers.”

If you would like to find out how Reeds Rains can help you buy or sell your property then visit the Acomb branch at 1 Carr Lane, York, North Yorkshire, YO26 5HT or call 01904 782621(*) for more information.

(*)Calls may be recorded for training and/or monitoring purposes.

House Price Index - July 2014

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 House sales recover to the highest level for 7 years - 4.6% annual price growth outside London and SE 

  • 90,000 sales in July, increasing 10% in a month as the market climbs back from April’s regulatory changes
  • Average house price rises to £270,636 – but driven by the capital and the South East
  • Annual growth in London climbs - taking average prices to £560,386
  • Prices stabilise across 7 regions in June as the market steadies

David Newnes, director of Reeds Rains estate agents, owned by LSL Property Services plc, comments: “First-time buyers and buy-to-let landlords are helping the flow of activity in the UK housing market. Overall 90,000 properties were sold across England and Wales in July, up 21% on a year previously and representing the highest monthly total since November 2007. As the common property choice of a new buyer or investor, flats have seen the largest increase in sales during the second quarter of this year, rising a third (36%) compared to Q2 2013. As the market emerges from the chrysalis of regulatory change, sales have climbed 10% in the past month. But chequered supply across the country has created considerable regional variation in sales. London and the South East have seen the slowest growth in house sales between Q2 2013 and Q2 2014. In these areas, limited availability of property is impacting sales. Elsewhere, lower prices and the stimulus of Help to Buy are aiding activity. The biggest boost in sales during April-June 2014 was found in the North West and East Midlands, increasing by a third (32%) on the same period last year.


“The average price paid for a home in the capital reached £560,386 in June, following a £10,850 (2.0%) monthly rise. After a temporary waning of growth in the London market, 24 boroughs have set new peak prices, and in Kensington and Chelsea average house prices are on track to surpass the £2million mark. However, a dampening of sales activity and more supply starting to come to the market will help control house price inflation in London.


“Housing policy should not be led astray by what is happening in prime central London. If London and the South East are removed from the equation, the annual change in average houses prices drops by 5.3% to 4.6%. Average prices in Northamptonshire, Bournemouth, and Wiltshire rose in June as the housing recovery starts to spread. The tendrils of recovery may be branching out from the centre, but they haven’t yet unfurled to all corners of the country. Outside of London, the South East and East Midlands, prices dropped and stabilised across all other seven regions in June.


“A more thoughtful and prudent housing market is emerging. Lending is stabilising to sustainable levels, and supply and demand is more balanced. Further interventions or tighter rules could fracture the health of the recovery, particularly further afield where schemes like Help to Buy are a necessary tonic spurring new buyers onto the housing ladder.”

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