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Bank of England might cut or raise rates after no-deal Brexit – Haldane

Bank of England Chief Economist Andy Haldane said on Thursday that the central bank could decide to raise interest rates or to cut them if there was a disorderly, no-deal Brexit.

The decision would depend on the balance of factors such as a fall in the value of the pound and the reduction in supply — such as less investment and fewer migrant workers — which would push up inflation, against the hit to demand, he said.

“It is genuinely two-sided which way we might act and how we will act will depend upon that balance of demand, supply and the exchange rate, just as it did pre-referendum,” Haldane said during a question-and-answer event at the Institute for Government think tank in London.

Source: UK Reuters

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Liverpool sees highest city property price inflation at 7.5% growth

The home of the Beatles, Liverpool, is outstripping any other city with property price inflation of 7.5% while cities including Aberdeen, Cambridge and London have seen no growth at all this year.
The fastest growing UK cities are the most affordable, with four cities including Liverpool, Newcastle, Aberdeen and Belfast, yet to recover to 2007 levels, data from Hometrack revealed.

Hometrack said: “Despite uncertainty around Brexit compounding the market slowdown in London, our analysis of income to buy indicates there is further scope for price growth in the most affordable cities, where prices are currently rising fastest.”

Overall, UK city house price inflation is running at 3.9%, up from 3.6% a year ago, largely driven by accelerating price growth in those affordable cities.

Struggling cities

The cities still in negative growth this year – Aberdeen at -3.8%, London at -0.3% and Cambridge at -0.1% – are suffering from both affordability and economic pressures.

Aberdeen has suffered as the oil industry has struggled, with house prices continuing to decline for the last three years. From a recent high of £198,000 in December 2014, average house prices have fallen back to £164,000, a decline of 17%, wiping out similar sized gains made between 2012-2014.

Two weeks ago, governor of the Bank of England Mark Carney said in the worst case scenario a chaotic no-deal Brexit could crash house prices by as much as 35% over three years and send another financial shock through the economy.

National data for housing sales and mortgage approvals for home purchase have remained broadly flat since 2015 and this slowdown has been focused on south eastern England, and primarily London.

Hometrack said: “In our view, the referendum result was a compounding factor for the slowdown in London house price growth since 2015. The primary drivers were stretched affordability, the impact of lending regulations and housing related tax changes, like stamp duty.”

Source: Your Money

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Build-to-rent schemes soar in London

Build-to-rent schemes have helped to more than double the total number of new homes registered in the capital.

The steep rise ends a period where London has been in the doldrums due to private homes for sale projects falling off as prices for one and two-bed apartments softened.

The surge in the capital helped to drive up total UK sites registered with the NHBC over the three months to August by 11%.

Soaring numbers of both private rental and to a lesser extent housing association schemes lifted house building starts by 145% to 5,774 compared with the same period a year ago.

A business development boss for one major contractor said: “Manchester and Birmingham have been the real hotspots for big build-to-rent schemes.

“While London has had its share of these project things are really taking off now in the capital with many projects out to bid.”

NHBC chief executive Steve Wood said: “We continue to see strong numbers in many parts of the UK with a substantial uplift in London, driven by increased activity by housing associations and the continued flow of inward investment on for-sale and private rental developments.

“The continuing uncertainties around Brexit and the UK’s economic outlook do not seem sufficient to dent confidence in the new homes market, where NHBC’s focus remains on helping developers to build more, high-quality homes for people across the country.”

More than 13,700 new homes were registered to be built in the UK during August, according to the latest NHBC registration figures, with strong growth in London.

Other regions to show growth over the three month trend period included Yorkshire & Humberside and the West Midlands.

NHBC – UK Registrations by Region
England – Regions June 18 – August 18 June 17 – August 17 % change
NORTH EAST 1,870 1,724 8.5%
NORTH WEST & MERSEYSIDE 4,373 4,786 -8.6%
YORKSHIRE & HUMBERSIDE 2,632 2,201 19.6%
WEST MIDLANDS 3,770 3,407 10.7%
EAST MIDLANDS 3,029 3,420 -11.4%
EASTERN 3,914 4,289 -8.7%
SOUTH WEST 4,156 3,698 12.4%
LONDON 5,774 2,354 145.3%
SOUTH EAST 6,457 6,653 -2.9%
TOTAL ENGLAND 35,975 32,532 10.6%
SCOTLAND 3,381 3,381 0.0%
WALES 1,230 1,529 -19.6%
NORTHERN IRELAND & ISLE OF MAN 1,961 854 129.6%
TOTAL UK 42,547 38,296 11.1%

Source: Construction Enquirer

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Bunged up housing market sends total value of London sales back below 2007 levels

London’s housing market has shrunk by a fifth since its last peak in 2016 as fewer homeowners move house.

The total value of all homes sold in the capital has tumbled by more than 20pc since 2016 and is worth 4pc less than it was in 2007, just before the financial crisis, according to the Office for National Statistics.

This is despite a 62pc rise in prices in the past 11 years.

The drop in total value of transactions illustrates the extent to which the market is bunged up, with a sharp drop in the number of sales taking place.

Nationally the number of home purchase mortgages fell to 42,581 in August, a drop of 4.2pc on the year according to industry data from UK Finance. It compares with a peak of more than 70,000 in August 2007.

A lack of supply and low transaction levels mean those sales which do take place are relatively expensive. The average home buyer borrowed  £197,800 last month, up 7pc on August 2017.

There are several reasons why the housing market is slowing down, particularly in the capital. Extra taxes on landlords, tighter lending restrictions and high prices have put off would-buyers in recent years, while last month’s rise in interest rates must also be factored in by buyers.

“Essentially, prices are very high and this has priced out a lot of buyers from the market,” said Hansen Lu at Capital Economics. “Deposit sizes are restrictive, credit is not as free flowing as it was before crisis – not that you would necessarily want it to be – and so transaction levels are down.”

Mr Lu said that while the number of first-time buyers entering the market was nearly close to pre-crisis levels, people who already own homes are the ones who have stopped moving up – or down – the housing ladder.

“That is where there is a reduction in transactions,” he said.

Economist Mike Jakeman at PwC expects the market in most of the UK to grow slowly while London’s prices edge down.

“That is partly because of Brexit-related uncertainty,” he said, calling the London market “stodgy” as a result.

“Bearing in mind buying a house is probably the single largest transaction you will ever make, when you don’t know what the outlook is going to be it just makes sense to sit on your hands for a bit, and of course that clogs it up for buyers and sellers.”

He predicts house prices will keep rising in the rest of the UK with particularly strong growth in Scotland and the Midlands.

Across England and Wales, housing transactions by value have fallen by more than 8pc since 2007. Unlike London, the market as a whole has never recovered to its 2007 level.

At the height of the housing market in late 2006 and early 2007, around 150,000 properties were sold every month nationally.

This plunged to below 60,000 in late 2008, before rising once more to plateau at around 100,000 a month since 2013.

By 2020 London should start recovering too, provided a Brexit deal is reached. Transaction volumes should improve too, Mr Jakeman said.

Source: Yahoo Finance UK

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British Property Federation announces plans to modernise commercial property sector

The British Property Federation (BPF) has launched a Technology and Innovation programme for the UK commercial property sector – to support the sector in its digital transformation – following the Government’s challenge to all sectors of the economy to improve productivity and deliver growth. The programme is launched with the publication of a new report produced by Future Cities Catapult, commissioned by the BPF, to understand the barriers to and opportunities for improving the productivity of the real estate sector through the application of technology.

The report Lost in translation: How can real estate make the most of the PropTech revolution? highlights that while 50 per cent of PropTech companies focus on sales/leasing, only 16 and 12 per cent respectively apply themselves in construction and investment/financing respectively. Land acquisition and refurbishment have less than five per cent of active PropTech companies. No companies, from the data sources used for the report, fell into the category for demolition/remediation.

Following a BPF-member survey, interviews and roundtables with key real estate and PropTech leaders, the report finds that there is significant untapped potential for greater adoption of technology to enhance productivity – and that the real estate sector must start by better articulating its pain points across the property lifecycle, so that innovators can better understand where there is more scope for technology to provide solutions.

To improve the sector’s engagement in and adoption of new technologies, the report’s recommendations to the sector, the BPF and the Government are:

  • Improve market information – there is a dearth of clear, quantitative and authoritative information, from the needs of different users across the property lifecycle to the nature and type of technologies on offer to property professionals.  It means that investment, buying and selling decisions are not optimised. To achieve this, next steps include:
    • Proptech Library – develop a library of all current and emerging PropTech innovation, classified in line with the lifecycle, user needs and technological drivers
    • Property Innovation Index – develop a property innovation index to assess a company’s capacity and preparedness for innovation/tech
    • Proptech Maturity Index – understand the level of maturity of technologies and give the market a better understanding of which technologies they should be investing in now
    • Research priority technology needs – the BPF is recommended to undertake regular research on the priority technology needs of members and their occupiers
  • Embed digital knowledge and foster innovative behaviours – the research uncovered scarce and unevenly distributed technical digital skills and a lack of business innovation mindset across the property sector. To achieve this, next steps include:
    • Put people with digital skills in influential roles – develop a programme to put early career software developers, engineers and designers and innovators in influential roles in property companies
    • Set up an open and challenge-based procurement platform
    • Leadership development course – the BPF is to create a leadership development course, including a comprehensive overview of the technologies driving digital innovation and the business models changing industries
  • Create a cohesive approach to championing innovation across the commercial property sector – the different asset classes, actors, innovators and regulators across different segments of the property lifecycle lead to a disconnected and unclear response to the many shared challenges and future vision. To achieve this, next steps include:
    • Shared language for the property sector – create a shared vision like the automotive industry has with ACES, to signal where the industry wants to head
    • Regulatory sandbox – the property industry, government and other strategic organisations to set up a property sector regulatory sandbox with a view to ensuring regulation does not fence out innovation and promotes it
    • Establish a property passport – the property industry and government to work together to set up a property passport with common data standards for core information relating to buildings
    • Consider productivity and wellbeing early – Centre for Digital Built Britain to work with industry, architects and innovators to improve consideration of productivity and wellbeing at the earliest stages of building design

Aligned with and responding to these recommendations, the BPF is setting up a new Technology and Innovation Group for the sector, to oversee its programme and drive closer collaboration across the real estate and technology sectors, to allow the benefits of technology to be maximised, and to preserve and enhance the UK’s reputation as a PropTech leader.

The Group will be led by Andy Pyle, UK Head of Real Estate, KPMG and also includes Nick Wright, Senior Director, Strategic Consulting – Investors, CBRE; Susan Freeman, Partner, Mishcon de Reya; Dan Hughes, Founder, Liquid Rei; and James Dearsley, Co-founder, The Digital Marketing Bureau.

Melanie Leech, Chief Executive, British Property Federation comments: “Today the BPF commits itself to provide thought leadership and deliver a practical programme to ensure the real estate  sector harnesses the benefits of technology, in line with the Government’s ambition for all sectors to better future-proof themselves, innovate and improve productivity and economic growth.”

Stefan Webb, Head of Digitising Planning, Future Cities Catapult says: “Digital tools, technologies and business models have transformed sectors from automotive to aerospace, yet the property sector has proven to be resistant to these forces. Many argue that the sector is too diverse, complex and complicated to be disrupted. However, there is more that unites the different asset classes, activities and actors across the property lifecycle in terms of data and digital than many realise. The choice for the sector seems clear, create a clearer vision, better market information and more collaboration between the sector or wait for someone else to join the dots and create a business that makes the impact of WeWork look relatively benign.”

Andy Pyle, UK Head of Real Estate, KPMG adds: “In our 2018 global proptech survey we found that whilst nearly all decision makers in the real estate industry agree they need to engage with technology, two thirds don’t have a clear tech strategy. Therefore it is hugely helpful to have an industry wide group to help understand how to respond to and capitalise on the opportunities technology creates. As the industry’s representative body, BPF is perfectly placed to do this and I look forward to leading the group.”

Source: Workplace Insight

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Rental cost and increases at record levels

In August, the number of tenants experiencing rent hikes increased to 40%, from 31% in July. This is the highest figure recorded since records began in January 2015 and the highest level every in August.

Year on year, this figure has increased from 35% in August 2017 and 27% in August 2016.

ARLA Propertymark is today issuing its August Private Rented Sector (PRS) Report.1

David Cox, ARLA Propertymark Chief Executive, said: “As we’ve highlighted before, the impact of recent and ongoing tax changes continues to have a material impact on the buy-to-let market. Four in ten tenants saw their rents rise in August – the highest level we’ve seen since records began. Although it’s encouraging to see the number of properties available to rent rising, supply still isn’t anywhere near high enough to slow down the pace of rent rises. We need more homes to rent, and for Government to change its narrative and recognise the very valid role buy-to-let plays in the housing mix. Driving small landlords out of the market ultimately impacts tenants most.”

Demand from tenants

  • Demand from prospective tenants fell significantly, with the number of house-hunters registered per branch dropping by 19% in August to 64 on average, compared to 79 in July.
  • Year on year, demand is down 11% as there were 72 prospective tenants registered per letting agent branch in August 2017.

Supply of rental stock

  • The supply of available properties rose to 197 in August, from 184 last month.
  • This is the highest figure seen since December 2017, when supply stood at 200.
  • Year on year, this figure is up four per cent from 189 in August 2017.

Source: Property118

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Consumer confidence in housing market falls – BSA

Consumer confidence in home purchase has dropped in September, with the BSA’s Property Tracker Index¹ at -4%, down on June’s figure of -1%.  The UK Public has now been net negative about the time being right to buy a new home, for 6 consecutive quarters.

Following the modest increase in the Bank Rate from 0.5% to 0.75% in August it is clear that the cost of monthly mortgage repayments is of increasing concern.  Overall, 48% of consumers saw this cost as a barrier to home ownership, up from 44% in June 2018.  The last time this number of consumers rated monthly repayments as a barrier was back in June 2014 (49%).

Commenting, Paul Broadhead, Head of Mortgage & Housing Policy at the BSA said:

“Consumer negativity on home purchase is borne out by a mortgage market which remains subdued.  The only area of mortgage lending which has seen any growth this year is the re-mortgage market.  This has been in part driven by borrowers looking to fix their mortgage rates as Bank Rate rises.   Now there is evidence that fixed rate periods are starting to rise with borrowers looking to secure their repayments before the Bank Rate rises again.

“Uncertainty about Brexit – deal or no deal – is dampening the volume of property purchases, with many of those who can delay doing so.  High house prices in some regions are still a huge issue, especially for first time buyers, and more than a third of consumers (36%) still believe that prices will rise in the next 12 months.  That should be set against 22% who believe that they will fall.

“Whichever way prices go, raising the necessary deposit has not diminished as a material barrier to owning your own home – the majority of consumers (65%) say that it is the most significant barrier that they face.

“Help to Buy: Equity Loan has been an important feature in the market for 5 years and has helped 170,000 buyers, both first time buyers and so-called second steppers.  Rumours that it is under review has caused some to demand that it becomes a permanent feature of the market and others for it to changed or be withdrawn.

“The fate of this scheme after 2021 was always going to be difficult, but in my view it should not become a permanent part of the market. Tapering it down could be one option. When Help to Buy (Scotland) was launched in 2013, it had a price cap of £400,000, this has been reduced £230,000 allowing more people to benefit from the available funding and targeting it at lower income families and first-time buyers. Another option could be to reduce the equity loan available from 20% to a lower amount.

“To sensibly manage the change, investors, lenders, developers, mortgage intermediaries and of course consumers, will all need time to adapt to a world without direct Government support. Now would be the time for the Government to make its intentions for the future of Help to Buy: Equity Loan crystal clear.”

Source: Politics Home

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UK mortgage approvals for new house purchases tumble despite growth in remortgaging

The number of mortgages approved for house purchases was almost five per cent lower in August compared with the same time last year, providing fresh evidence of flat activity in London’s property market. Despite the fall in new mortgage approvals, remortgaging soared 9.2 per cent during the month, as a rising number of homeowners looked to lock in more favourable deals ahead of expected higher interest rates.

However, the mortgages approved for people buying houses were down 4.2 per cent year-on-year, underlining a continuation of subdued activity in London’s housing market.

Meanwhile, gross mortgage lending for the total market in August was £24.1bn, falling 1.2 per cent lower than a year earlier, according to today’s UK Finance figures.

Jeremy Leaf, north London estate agent and a former Rics residential chairman, said: “At first glance these figures look quite encouraging but when you appreciate that a substantial part of the increase in lending is to do with remortgaging in anticipation of higher interest rates, the picture is not so rosy.”

Leaf added: “Mortgage approvals for house purchase are lower compared with this time last year, which was not a particularly impressive time anyway. Clearly, the market remains fairly flat without too much movement one way or the other, which is reflected on the high street.

“Confidence is in short supply unless new market conditions are recognised. Having said that, we are seeing more viewings and more realism as the summer period is now behind us. It is now up to sellers to recognise that the market is unlikely to change for the better for some time.”

The news comes despite recent Bank of England data showing that mortgage lending picked up in the second quarter of the year, with new commitments hitting their highest level in more than a decade amid a bump in the number of first-time buyers coming onto the property market.

Peter Tyler, director at UK Finance, said: “Remortgaging continued to dominate in August, as homeowners took advantage of a competitive market to lock into attractive deals. Growth in card spending remained fairly strong, reflecting the boost to retail sales from the warm weather as well as the growing use of credit cards as a preferred means of payment.

“However, the overall economic outlook remains mixed as household incomes continue to be squeezed by rising inflation.”

Source: City A.M.

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Get Your SME Finance-Ready – 5 Actions to Improve Your Business Loan Eligibility

Looking to get an SME loan? Avoid these common mistakes to immensely improve your chances!

Taking the entrepreneurial leap of faith might well turn out to be the most rewarding thing in your life. The sheer joy of seeing a plan, a concept – a dream, indeed – materialise is indescribable. But to get there, you’ll first need to take off the rose-tinted glasses.

The world of business is ruthless beyond measure. No industry, no sector, no niche is devoid of competition. Therefore, your business – like every other business – will need to withstand this competition day and night in order to survive, thrive and, eventually, succeed. And this process invariably involves scaling up your business – a point at which drawing strength from your personal savings or seeking help from friends or family just isn’t enough. This is when you, as an SME, are most likely to seek external funding and financing. This, also, is when you have every chance of seeing multiple business loan applications turned down.

How does a young SME go about securing a business loan that’s both substantial and fair?

That’s a question that needs to be discussed in multiple blogs. For now, we will take a look at the steps that you can take to give your business the best chance of getting business loans. Before that, however, it will be more prudent to understand how the lenders perceive SMEs.

SME Lending Is Changing

  • The lending landscape is fast changing.
  • Open Banking will make getting business loans less difficult for SMEs.
  • Banks’ isn’t the only voice that matters.

SME Lending in the UK – A Stat Check

  • Asset finance, general business loans, equity finance & most other commercial SME loans have grown in size since 2015.
  • As many as 7 in 10 small-business loan applications were approved by lenders in 2017-18.
  • 62% of all SME finance applications in 2017-18 stated business growth as the principal reason for the loan.

British Business Bank SME Finance Report 2017-18

UK Finance Quarterly Reports

Liberis Business Survey 2018

Regardless of the narrative or the wider picture, it’s safe to say that the lenders have always dictated the terms of the commercial finance game. They have had the absolute right – at times, an unfair proposition – to accept, modify or reject business loan applications from SMEs as they see fit. While this isn’t likely to change anytime soon, there are definitely some levellers being introduced by the government to make the playing field more even.

The first amongst this is the rather dramatic arrival of Open Banking (better known as PSD2 across mainland Europe) earlier this year. This purported game changer will not have as much of an impact on everyday banking as most thought. The lending game, however, has been forever changed since its introduction. Thanks to the absolute customer-side control of finance data, your business can now request – nay, compel – big banks in the UK to share your 12-month financials, credit history and other data with private, P2P or overseas lenders. While such data sharing isn’t a new concept, the edge lies in the fact that Open Banking will let the borrower have more control over their data. What this means, essentially, is that getting your SME finance-ready will be much, much easier now than it was five years ago. The lenders will be able to make better, more informed lending decision based on this data – just about as seamlessly as personal loan or credit card applications work.

This development is in perfect alignment with the Small Business Enterprise and Employment Act of 2015 that had made it mandatory for banks and institutionalised lenders to share finance data with alternate credit partners for SME loans.

The fact of the matter is – if you run an SME in the UK, you have a great chance of securing a business loan today than ever before.

What Does It Take for an SME to Get a Business Loan in the UK?

The lending criteria differ from one lender to another. They also depend upon the type of the loan you seek. Some of the most common and fundamental lending criteria for SMEs in the UK are:

  • The borrower should be a registered business entity (Sole Trader, LC, LLP or PLC).
  • The business should have a ‘demonstrable’ trading history of 18-24 months.
  • The director(s), owner(s) or proprietor(s) should be able to furnish personal guarantees if required.
  • The business financials should be able to demonstrate a certain minimum turnover (subject to the amount of the loan).

Understanding Why the Lenders Are Forced to Say ‘No’

Despite the lending atmosphere that’s gaining in positivity as far as SMEs are concerned, quite a few business loans are still routinely declined. In this light, it’s important to understand the common reasons why small-business loan applications fail to get approved. This will help you eliminate a major hurdle in getting finance for your business.

The Business Isn’t on Top of Their Credit Score(s)

Countless SME loan applications fail to pass the very first check that banks perform – the credit check. What’s more astounding is the fact that many SME owners aren’t even aware of the credit trail they leave while their business is trading.

The Business Has Problems

It’s a vicious cycle but that’s how it is.

Most businesses apply for loans when there’s a cash crisis. And lenders don’t like such situations. This Catch-22 is perhaps the biggest hurdles SMEs face in getting approved for a business loan. Along with cashflow problems, other problems such as a questionable business plan, a history of poor business decisions, lack of expertise at the helm and inability to prove the growth potential often lead to loan applications being turned down.

The Time Just Isn’t Right

You cannot apply for a regular SME business loan if your business is just starting up. Most lenders will want to see a trading history of no less than 2 full years. Similarly, if you’re applying for a business loan and your business has been trading for 20 years with little to show for it in terms of growth, the lenders won’t take a liking to your application.

There’s No Collateral Provided

Unsecured business loans attract closer scrutiny from lenders. So, for an SME that doesn’t have a great deal of creditworthiness, it becomes imperative to provide additional security. Business loan applications that aren’t backed by adequate collateral or guarantees usually get declined.

The Plate is Already Too Full

Just like personal loans and mortgages, you cannot expect to get a business loan for your SME if you already have a number of repayments to take care of. A business loan application from an SME dealing with a plate full of loans is almost certain to get rejected, leading to a soft credit enquiry mark that further worsens the situation.

Steps You Need to Take to Improve Your Business Loan Eligibility

There’s no telling what the lender will think of your business loan application. Perception is a strong phenomenon and is still relevant despite much of the work being handled by tried-and-tested credit algorithms. You can, however, take the following steps to make sure that your application stands a very good chance of finding takers.

1. Make Sure the Foundation of Your Business is Strong & Convincing

You want the foundation of your business to be sound, strong and stable. This is vital not just to secure a business loan but also to achieve profitability in the long run.

When you know that your business has a great shot at success, you should be able to convince other people of the same. To convince lenders, you will need a great business plan – especially when your business is relatively new. A good business plan should be accompanied by a cause-and-action plan. This will involve a good explanation of why your business needs a loan, how you plan on using the funds and what your repayment schedule will be like.

A fully customised proposal with all the relevant details shows the lender that you’re serious about the business. This always works in your favour as lenders perceive you as less of a risk and more of an opportunity.

2. Get Your Business Financials in Order Before You Apply

Many businesses get this wrong – but you shouldn’t. Never apply for a business loan if you don’t have an independently audited, tax-certified financials for at least two years in your possession. These financials typically include the tax returns, quarterly balance sheets, cashflow analysis and profit/loss statement.

It’s common for lenders to also request projections over the loan term. So, it’s a good idea to prepare revenue, profit/loss and assets/liabilities projections for up to 5 years before you approach a lender.

3. Know and Understand Your Credit Scores

Regardless of everything else, most lenders will eventually take a look at the credit history of your business before making a decision. Any obvious red flags on this report – from delayed payments and missing records to frequent enquiries and grave defaults – will hurt your application. So, it’s important to know and understand your credit scores before you apply. This includes building a solid credit history for your business as well as personal accounts.

Less than 20% of all SMEs in the UK proactively monitor and assess their credit scores – you don’t want to be a part of that group!

Some useful steps in this regard are:

  • Checking your business credit score once every quarter
  • Filing for corrections when you spot inadvertent mistakes or errors
  • Using a dedicated business account for your business activities
  • Utilising credit facilities such as overdrafts and credit lines judiciously
  • Making timely repayments
  • Not making ‘hard’ enquiries for credit unless you are ready to submit a full application

4. Let the Lenders Know That You Are Invested

A commonly ignored and often decisive mistake is the failure to demonstrate your involvement in your business. Many businesses – especially the ones not registered as Sole Traders – face this problem, just because there’s no ‘face’ attached to the business.

An easy way to avoid this is to make an offer for a collateral. This shows the lenders that you are willing to share the risk with them. Secured loans are always easier to go through.

5. The Time and Timing – Both Should Be on Your Side!

As a rule of thumb, you shouldn’t go searching for a business loan when your business finds itself cornered with nowhere to go. This will only lead to you ruining your credit history with multiple rejections. Having enough time at your disposal is the key. This is where good business intuition and experience will come in handy for you.

As far as getting the timing right goes, you should be well aware of the market situations before applying for a loan. Has the industry your business operates in been faring poorly of late? Have there been any major changes in the lending landscape recently? What has been the trend in the interest rates being offered over the last six months?

Answers to such questions will give you an idea about whether you should apply for a loan right away or it’ll be wiser to wait for a few weeks.

Getting a Business Loan is a Process and Should Be Treated as Such

Many loan applicants think that lenders are prone to making arbitrary decisions. While true in rare scenarios, this usually isn’t the case. The lenders are also in the business – the business of lending money. The more businesses they lend to, the more money they end up making. So, as long as you have taken care of the ‘risk’ factors discussed in this article, you will have little to worry about when you apply for an SME loan.

Applying Left, Right & Centre – A Big No!

The biggest – and unfortunately, the most common – mistake that SMEs make is to apply for credit with no plan of action. Applying at a dozen places will not only lead to simultaneous rejections that will do your credit score no good but also handicap your business from accessing finance when you need it the most. Before applying for any business loan, you should be aware of what your options are – without making hard credit enquiries.

That is exactly what we at Commercial Finance Network, a leading whole of market broker, do for you. Working with some of the best-known and specialist lenders across the UK, we make sure that you get a loan offer that’s fair, fast and flexible.

The days of blindly accepting the first offer that comes your way are long gone. Let our team of experts curate the best business loan quotes for you. Call us on 03303 112 646 or contact us to speak with one of our Business Loan Specialists today!

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Brexit and the City – A barometer for London’s financial outlook

London’s skyline is changing fast, pierced by gleaming new skyscrapers which defy predictions of a Brexit-related slowdown in the capital’s two financial districts.

With only six months until Britain is due to leave the European Union, the terms of its separation have yet to be decided, leaving critical questions over the long-term future of London as the bloc’s pre-eminent financial centre.

Some politicians and economists expect the split will damage the City, as the capital’s traditional financial services centre is widely known, while Brexit supporters say it will benefit from being able to set its own rules.

Reuters is publishing its third Brexit tracker, monitoring six indicators to help assess the City’s fortunes, taking a regular check on its pulse through public transport usage, bar and restaurant openings, commercial property prices and jobs.

The latest Reuters assessment shows a slowdown in some areas, while others are thriving despite the uncertainty.

“It is certainly an awful lot better than we expected 12 months ago and dramatically better than we expected 24 months ago,” Mat Oakley, head of European commercial research at real estate agents Savills, said.

Although property prices and hiring rates have slowed, the number of bars and restaurants open in the centuries-old financial district are at a record level and financiers still queue at the security scanners at nearby City Airport.

Britain is due to leave the EU on March 29 next year, but there is so far no full exit agreement and Prime Minister Theresa May’s plans for future trade ties have been rebuffed by both the EU and many lawmakers in her own party.

Many business leaders fear that a political crisis could propel Britain into a chaotic and economically damaging split, spooking financial markets and dislocating trade flows.

The latest Reuters jobs review shows just about one-in-ten of the about 5,800 jobs flagged as being at risk of moving out of London or being created in another EU city by the end of March have actually moved, although many firms have taken steps to change their legal structure to enable a swift change if needed.

Jobs leaving London

As few as 630 finance jobs have so far been shifted or created overseas due to Brexit, a far lower number than first predicted, suggesting London will retain its position as one of the world’s top two financial centres, firms employing the bulk of UK-based workers in international finance told Reuters.

The results from a Reuters survey of 134 firms, following up on two previous surveys, show that although companies have made detailed contingency plans they are delaying moving large staff moves until after the outcome of negotiations with the EU on the future trading relationship.

Hiring numbers

The number of available jobs in London’s financial services industry fell the most in six years in 2018, said recruitment agency Morgan McKinley, which hires staff in finance.

It bases its number on the overall volume of mandates it receives to find jobs and applies a multiplier based on its market share of London’s finance industry.

Commercial property

Reuters obtained property data from Savills and Knight Frank, two of the biggest real estate firms in Britain. Savills calculates the value from all-known property deals within the City of London area.

The price of renting real estate in the City of London district fell 6 percent in the first six months of the year, falling to 75 pounds per square foot, from 78 pounds in the third quarter of 2016, Savills says. The rental prices are 1 percent higher than in June 2016 when Britain voted for Brexit.

“The story seems to be that big corporates are planning through any period of potential uncertainty. They are taking a five or more year view because some of these deals that we count as happening today or happening in the first half of the year the tenants are not moving in until say 2022,” Mat Oakley, head of European commercial research at Savills, said.

“I wouldn’t say prices are booming….but they are certainly holding steady.”

In Canary Wharf, prices are little changed since last year, Knight Frank, whose data comes from landlords, developers and agents, say.

Global foreign exchange

Britain has defied sceptics and extended its lead in the global currency trading business in the two years since it voted to leave the European Union.

Reuters analysis shows forex trading volumes in Britain had grown by 23 percent to a record daily average of $2.7 trillion (2.1 trillion pounds) in April compared to April 2016. That was double the pace of its nearest rival, the United States, which was up 11 percent to $994 billion, mostly out of New York.

Going Underground

Some 400,000 journeys are recorded every day at the three main underground stations that serve the City and Canary Wharf.

Reuters filed Freedom of Information Act requests to Transport for London, to get this data, which shows that the number of people using Bank and Monument stations fell in the first six months of the year.

City Airport

The number of passengers using London City Airport, a popular gateway for finance executives, rose to a record high in the first six months of the year.

Bar and restaurant openings

Reuters filed a Freedom of Information Act request to the City of London Corporation to find the number of new premises which have applied for licenses to sell alcohol and license renewals.

The number of venues, such as bars and restaurants, with licenses to sell alcohol in the City of London in 2017 rose 10 percent, data from the municipal local authority shows.

The number of venues applying for new licenses fell slightly compared with 2016, the data shows, although the City of London Corporation said such fluctuations are normal.

Source: UK Reuters