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Broker confidence holding up

Some 71% of brokers are confident in the mortgage market’s prospects in the next 12 months, despite the difficult few months they have encountered.

The research, from Masthaven, found that only 3% of intermediaries are not confident.

Rob Barnard, director of intermediaries at Masthaven Bank, said: “Broker confidence is holding up well and that’s such an important part of the market, as it directly feeds through into the conversations intermediaries are having with customers.

“Now that the housing market has reopened and with the news that mortgage payment relief may be extended to help those customers in need, it’s good to see positive sentiment for the next twelve months from the intermediary community.”

More than half (51%) of specialist lending intermediaries are using video calls to liaise with their customers, while 42% are sending regular email updates.

Nearly a third (32%) of specialist lending intermediaries said that they are recommending lenders based on their access to reliable funding.

BY RYAN BEMBRIDGE

Source: Property Wire

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Leicester rated the best city for investors

Leicester is the best city in the UK to invest in property and start a new business, a report by savings marketplace Raisin claimed.

The business survival rate in the city is over 91% and house prices have risen by 28.3% in the past two years,

The average house price in Leicester is £246,000, which has increased from £176,382 in the past two years – a rise of over £69,000.

Kevin Mountford, co-founder of Raisin UK, said: “Whether you’re buying a house, you have to weigh up the pros and cons, and the location is a key factor in that.

“Using the Raisin UK city investment index you can find the most practical and profitable location for your business and property needs, encouraging the most successful outcome of your investment and hard-earned savings.”

The second and third best cities were Bristol and Coventry, as both have high rates for business survival (88.7% and 90.6%) and house price increases of 26% & 28%.

BY RYAN BEMBRIDGE

Source: Property Wire

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BoE not remotely close to decision on negative rates, says chief economist

The Bank of England’s chief economist has said the bank is not remotely close to any decision on taking interest rates below zero to cope with the pandemic.

Andy Haldane said the key factors for the BoE to consider were the consequences of negative rates for banks and lenders, which would squeeze margins.

“Those are the aspects that we’ll look at,” Haldane said during an online discussion organised by the Confederation of British Industry on Tuesday.

“To be clear, reviewing and doing are different things and currently we are in the review phase and have not reached a view remotely yet on the doing.”

Since the start of the coronavirus outbreak, the bank has slashed its main rate to a record low of 0.1 per cent, prompting questions about whether it will cut into negative territory to stimulate the economy further.

It would mean banks are charged a small amount for keeping their money with their country’s central bank. The European Central Bank’s (ECB) deposit rate is currently minus 0.5 per cent.

Last week, BoE governor Andrew Bailey said it would be “foolish” to rule out negative interest rates. He has previously argued against them but admitted he had changed his position.

He was keen to highlight that the Bank is not saying it will cut rates further: “We’re not ruling it in but we’re not ruling it out.”

Haldane also said the recent economic data was coming in a “shade better” than a scenario published by the bank earlier this month.

“This is perhaps still a V but perhaps a fairly lop-sided V,” he said, referring to the shape of the economy’s downturn and recovery.

“The risks to that probably…lie to the downside rather than the up and as I say, a rather more protracted recovery even than the one that I have mentioned.”

By Angharad Carrick

Source: City AM

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English buyers and reopened English housing market drives demand in Scotland

It’s been two weeks since some of the restrictions on the property market were eased in England but Scotland remains in lockdown.

The publication of Scotland’s COVID-19 route map last week stated that “preparing for the safe reopening of the housing market” would be part of Phase 1 and “relaxation of restrictions on housing moves” would be part of Phase 2.

Phase 1 is due to begin on 28th May, and certain criteria must be met before we can progress to Phase 2 – the next formal review will be held on the 18th June.

ESPC has seen steady increases in viewing enquiries, valuation requests, Home Report downloads and web traffic for a few weeks now, but this increase has become more evident since the English market activity resumed.

While these figures are still lower than usual for this time of year, this increase highlights that there remains strong interest in moving home once some of the current restrictions have eased.

In a recent survey of 30 of their members, 23 stated that they had seen an increase in enquiries since news of the English market restrictions being eased.

The remaining seven agents said activity and enquiries remained about the same as before.

Marion Walker, Property Manager at Castle Douglas-based Hewats Solicitors and Estate Agents, said:

“Since the restrictions were lifted in the housing market in England, I have seen a significant increase in enquiries from south of the border.

“The enquiries range from asking about Home Reports to requests to book in person viewings, which are not currently available in Scotland due to lockdown measures.

“Following on from the recent bank holiday, I would say our daily enquires have risen by a good 50% plus, with English buyers commenting that they had always planned to move to the region and the current situation has moved their plans forward.”

Dianne Paterson, Partner at Russell + Aitken, an agent with offices in Edinburgh and Central Scotland, said:

“Although the property market has not ceased completely during lockdown, it is noticeable that, since the regulations were relaxed in England, we have received an increased number of enquiries on both the sale and purchase side.

“Once the regulations in Scotland are relaxed, we anticipate that the Scottish market will be a busy one, fuelled by eager purchasers and sellers, whose plans were put on hold during this period.

“We are expecting an active few months, with both an increased interest in, and availability of, properties for sale.”

Mary McQueen, Partner at McDougal McQueen, an agent which operates in Edinburgh and the Lothians, said:

“There’s definitely been an increase in new buyer enquiries, and viewers who previously enquired getting in touch again as they think in person viewings have resumed in Scotland as well.

“There have also been more enquiries asking for definite and dates when viewings will start.

“The majority of people do appreciate the need for restrictions but are very keen for them to be eased so we can get back to some sort of normality.”

Michael Maloco, Senior Partner of Dunfermline-based Maloco + Associates, said:

“We’ve had two really busy weeks. We’ve done five or six virtual valuations with four listings of the back of these.

“There have been lots of virtual viewings arranged and physical viewings booked in for when they are possible, with 18 bookings for one property alone.

“We may also have at least one closing date next week too.”

Cochran Dickie Estate Agency has noted an increase in enquiries in the west of Scotland since news of some English property market activities resuming. Curtis Chisholm, a director of the firm commented:

“We have a number of enquiries coming in from people looking to view current stock.

“We have one house in Castlehead in Paisley, which went live just before lockdown, that has 58 viewers lined up.”

Source: Property Industry Eye

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Zoopla: Demand for housing in England surpasses pre-lockdown levels

Two weeks after the government reopened the property market, demand for housing in England has exceeded levels recorded at the start of March, according to the latest UK Cities House Price Index by Zoopla.

Zoopla found that demand for housing across England rose by 88% after the market reopened in the week to 19 May, exceeding pre-lockdown levels by 20%; this jump in demand in England is expected to moderate in the coming weeks.

Six in 10 (60%) buyers in the UK are planning to continue with their search for their next home.

Of that cohort, 22% said that they have not been impacted by COVID-19 and expect to continue unaffected.

Meanwhile, 37% said that while they had been impacted to some extent, they were looking to continue with their purchase as soon as possible.

By contrast, 41% had put their plans on hold, citing market uncertainty, loss of income, and diminished confidence in future finances as deterrents.

Demand rebounded faster in cities along the south coast and in northern England.

Portsmouth and Southampton have registered demand 40% higher than in February this year, with strong growth also recorded in Newcastle and Leeds.

While demand for homes has grown, harder measures of market activity are increasing more slowly.

New sales agreed, sold subject to contract, were running at 10% of normal levels over the lockdown period and have now started to increase off a low base, based on viewings from before the lockdown.

Zoopla expects sales volumes to increase further, but at a more moderate pace given the typical two month lag between new demand entering the market and sales being agreed.

Moreover, if available supply does not increase, then not all demand will be satisfied.

The annual rate of house price growth fell from 2% to 1.9% from March to April, representing the lowest month-on-month change since January 2019, and prices were unchanged in April.

Richard Donnell, director of research and insight at Zoopla, said: “The scale of the rebound in demand for housing is welcome news for estate agents and developers, but it is also surprising given projections for a sharp rise in unemployment and a major decline in economic growth.

“The COVID crisis and 50-day lockdown have created an unexpected one-off boost to housing demand.

“Millions of UK households have spent a considerable amount of time in their homes over the lockdown period and missed out on hours of commuting.

“Many households are likely to have re-evaluated what they want from their home.

“This could well explain the scale of the demand returning to the market.

“We need to see more supply come to the market to satisfy this demand.

“The economic impacts of COVID will grow in the coming months and uncertainty is building.

“The majority of would-be movers plan to continue their search, encouraged by low mortgage rates and continued government support for the economy.

“However, we expect the latest rebound in demand to moderate in the coming weeks as buyers and sellers start to exert greater caution.

“Further support from the government can’t be discounted and would help limit the scale of the downside risks.”

James Forrester, managing director of Barrows and Forrester, said: “You only have to look at the miles of queues approaching your local drive-through takeaway of late to see what happens to demand levels when you deprive the nation of something.

“This is certainly no different when it comes to the appetite for homeownership and a huge uplift was always on the cards following the reopening of the property market.

“This will level out as estate agents begin to facilitate this activity on both the side of buyers and sellers and it will certainly help to quell the huge uplift seen in recent weeks.

“However, this trend is unlikely to subside altogether and this ongoing demand will help to stabilise the market from a price point of view over the coming months.”

Colby Short, founder and CEO of GetAgent.co.uk, commented: “We’ve seen market sentiment strengthen as uncertainty has evaporated and market restrictions have been lifted and while this will no doubt be more pronounced to begin with, it’s unlikely to fade over time.

“Given that the market has also returned before any momentary price impact has come to the surface, it’s unlikely that sellers will budge when it comes to asking price and any long-term price reductions will be non-existent.”

By Jessica Bird

Source: Mortgage Introducer

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Lenders pledge ongoing support for those affected by Covid

Mortgage lenders are committed to supporting borrowers who are reaching the end of a three-month payment holiday to choose the next steps that best suit their needs, according to UK Finance.

This comes after HM Treasury confirmed last week (May 22) that mortgage customers, who were struggling to pay due to the coronavirus, can extend their payment holiday for an additional three months or begin to make reduced payments.

Figures from UK Finance showed that an equivalent of one in six mortgages are currently covered by a payment holiday, with more than 1.82m payment holidays having been issued as of May 20.

The industry body said it was “important that customers receive the support that is right for them” and for those who had already taken a payment holiday, an extension “may be appropriate in some circumstances”.

It encouraged borrowers who are concerned about their ability to pay to contact their lender and consider the “full set of options available to them”.

These include reduced payments, a move to interest-only payments for a period, extending the term of the mortgage to reduce payments, taking a payment holiday if the customer has not already done so or a further extension of the payment holiday.

Stephen Jones, UK Finance CEO, said: “Mortgage lenders are committed to providing those borrowers nearing the end of their three-month payment holiday with help and flexibility in choosing the next steps which best suit their needs.

“The industry looks forward to regulatory guidance being finalised swiftly to ensure both borrowers and lenders can plan over the coming weeks.

“Meanwhile those borrowers who have already taken a mortgage payment holiday and can afford to make payments are encouraged to do so, as this will reduce the level of their repayments in the long run.”

In response, Vim Maru, retail director at Lloyds Banking Group, said: “We are already proactively contacting our customers who will be reaching the end of their repayment holidays to support them in restarting their payments.

“For those who may continue to be financially impacted, we will offer a range of support based on their current financial circumstances.”

But Dominik Lipnicki, director at Your Mortgage Decisions, said he would welcome a “more uniformed approach from lenders when it comes to the ease of application [of a payment holiday] and how these borrowers are looked at in the future when remortgaging or buying a new home”.

Research from YouGov for Nationwide found that 21 per cent of homeowners in April were worried about not being able to keep up with mortgage payments, and 14 per cent feared losing their home.

Lenders have also committed to continue suspending involuntary repossessions for residential and buy-to-let customers until October 31, as set out in the Financial Conduct Authority’s draft guidance for lenders published last week (May 22).

On the day the FCA published its draft guidance, Nationwide pledged that none of its mortgage customers, who fell into arrears as a result of Covid-19, would see their home repossessed until the end of May 2021, if they worked with the provider to “get their finances back on track”.

Joe Garner, chief executive at Nationwide, said: “As a mutual, founded to help people into a home of their own, this is what building societies have always been about. We hope this additional support will provide extra flexibility to those who most need it, to help get them back on track.”

Mr Lipnicki added: “The fact that repossessions are on hold is a very welcome relief for affected borrowers and I am sure that more flexibility will need to be applied even after October 31”.

By Chloe Cheung

Source: FT Adviser

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Masthaven: Three quarters of brokers confident of mortgage market prospects

Almost three quarters (71%) of intermediaries remain confident in the mortgage market’s prospects for the next 12 months, despite the ongoing coronavirus crisis, research from Masthaven Bank has found.

In a survey of more than 200 intermediaries conducted in May some 65% said they were confident whilst 6% said they were very confident – a quarter said they were unsure.

Only 3% of intermediaries surveyed said they were not confident in the market’s prospects for the coming year.

Rob Barnard, director of intermediaries at Masthaven Bank, said: “Broker confidence is holding up well and that’s such an important part of the market, as it directly feeds through into the conversations intermediaries are having with customers.

“Now that the housing market has reopened and with the news that mortgage payment relief may be extended to help those customers in need, it’s good to see positive sentiment for the next twelve months from the intermediary community.”

The survey also found that more than half (51%) of specialist lending intermediaries are now using video calls to liaise with their customers, while 42% are sending regular email updates.

A small proportion of brokers have introduced live chat platforms on their websites (4%) or extended their opening hours (2%) since the start of the pandemic.

Nearly a third (32%) of specialist lending intermediaries said that they are recommending lenders based on their access to reliable funding.

Jon Hall, chief commercial officer and deputy CEO at Masthaven Bank, said: “Masthaven has remained open for business throughout the crisis.

“We have continued to work with intermediary partners to ensure they have access to a good range of competitive products.

“We have adapted our service offerings, launching a fee-free remortgage range in response to broker demand and increased our use of AVMs where physical valuations have not been possible. Our offices may be closed but we remain open for business.”

By Ryan Fowler

Source: Mortgage Introducer

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Buy to let specialist reports surge in North West rent prices

Rents in the North West are growing faster than any other region in the UK, with rental growth in London continuing to slow over the past few months.

That is the claim by high-yielding student buy-to-let investment specialist Mistoria Group.

It said rental values in the North East, North West, East Midlands, Scotland, Yorkshire & Humberside, Northern Ireland and Wales all rose at a rate faster than the UK average. (Source: The HomeLet Rental Index, March 2020).

Average rents across the UK rose by 1.8% in March 2020 year-on-year, with the average monthly rent sitting at £959 per month.

When London is excluded, the average UK rental value was £793 in March 2020, up 1.4% on last year.

The data also reveals that rents rose from last year in nine out of 12 of the regions covered in the research.

Data from The Mistoria Group shows that rent prices in the cities and towns in the Northern Powerhouse have risen by an average of 17%, with rental cash yields of nine per cent in Salford, and seven per cent in Liverpool and Bolton.

With a capital appreciation of five per cent, investors are looking at total yields between 12-14%, which is extremely attractive. The group said if geared, the returns could be between 20% to as high as 35%.

The resilient property market in the North West is helped by the highly-successful regeneration of the area which has brought new jobs, transport links and a range of large housing projects, proving the strength of the economy as a whole in the region.

According to Mish Liyanage, managing director of The Mistoria Group, there is growing demand for high-end HMO (homes of multiple occupancy) accommodation among young professionals and students across the Salford, Bolton, Manchester and Liverpool areas

He said: “BTL (buy to let) investors can buy a luxury HMOs in the North West from £120k upwards. The return on investment is very attractive, too, with an average 13% yield (eight per cent cash rental and five per cent capital growth).”

By Neil Hodgson

Source: The Business Desk

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House buyer demand surges after government lifts property market restrictions

Demand from potential house buyers spiked 88 per cent after lockdown restrictions on England’s property market eased earlier this month, according to the latest research.

However, the pent-up demand varied between cities, according to the latest research by Zoopla, and the rebound in London has been less pronounced than other English cities.

The research found that some potential buyers could be looking to move to commuter towns outside of the capital after working from home during the coronavirus lockdown. It also said affordability of housing could have slowed down the bounce back in London.

Demand has bounced back strongly in northern England and cities along the south coast since the government gave the go-ahead for the housing market to reopen.

The surge in demand is expected to be temporary and slow in the coming weeks.

The Zoopla Cities Index found that 60 per cent of potential homemovers across Britain were planning to go ahead with their plans, however 40 per cent had put potential moves on hold due to the pandemic.

Meanwhile, new sales agreed in England increased 12 per cent since the market reopened two weeks ago.

Zoopla director of research and insight Richard Donnell said: “The scale of rebound in demand for housing is welcome news for estate agents and developers, but it is also surprising given projections for a sharp rise in unemployment and a major decline in economic growth.

“The Covid crisis and 50 day lockdown have created an unexpected one-off boost to housing demand. Millions of UK households have spent a considerable amount of time in their homes over the lockdown period and missed out on hours of committing. Many households are likely to have re-evaluated what they want from their home.

“This could well explain the scale of the demand returning to the market.”

However, he added that uncertainty will build as the economic impact of the pandemic becomes clearer over the coming months.

“The majority of would-be movers plan to continue their search, encouraged by low mortgage rates and continued Government support for the economy,” Donnell added.

“However, we expect the latest rebound in demand to moderate in the coming weeks as buyers and sellers start to exert greater caution. Further support from the Government can’t be discounted and would help limit the scale of the downside risks.”

By Jessica Clark

Source: City AM

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Build-to-rent development launches in Wembley

HUB has completed Chesterfield House in Wembley, North London, a 239-home build-to-rent development designed by architects Maccreanor Lavington.

The landmark scheme, which comprises two buildings of 21 and 26-storeys, has been handed over to Realstar, which will operate Chesterfield House under its UNCLE brand.

The development is now known as UNCLE Wembley.

Alex Hall, senior development manager at HUB, said: “The new development brings 239 exemplar build-to-rent homes to Wembley under the UNCLE brand, including extensive public realm and retail from which the whole community will benefit.

“Not only is the project a fantastic new asset for the area, it is also an architecturally superb building that we believe represents a real step-change in quality for Wembley and acts as a regeneration marker for the High Road.

“As we now look ahead to delivering Wembley Link, HUB’s second development in the revitalisation of Wembley High Road, we would like to thank the people of Wembley for their crucial input during consultation for Chesterfield House.

“We would also like to thank our contractors Henry Construction for their commitment to the project in ensuring the extremely high-quality and timely delivery of UNCLE Wembley.

“Since day one, HUB has worked closely with local people to secure the best outcome for everyone – and we believe that UNCLE Wembley represents just that.”

The property will offer a choice of furnished and unfurnished apartments, with the furnished element provided by Danish brand Bo Concept.

UNCLE said it made sure the amenities are also focused around enhancing the physical and mental well-being of its residents.

These include a fitness studio with Technogym equipment and a TRX wall, a Zen Zone which incorporates an InHere Meditation Studio, a rooftop terrace and BBQ area as well as an indoor three-point basketball court.

The two main blocks are connected by a seven-storey building which frames a new public square at ground floor level. The square features seating, paved areas as well as new planting.

A public walkway through the link building also provides access to potential future phases of development behind the High Road.

The project was delivered via a partnership between HUB and specialist investor Bridges Fund Management. Building contractor Henry Construction completed work at the Brent site last month following a three-year programme to deliver Wembley’s tallest building.

BY RYAN BEMBRIDGE

Source: Property Wire