All the latest Property news -40-year mortgages jump in popularity
Posted by The Oracle Group on 22nd July 2019 -
MORTGAGES
40-year mortgages jump in popularity
The number of mortgages with a term of more than 40 years rocketed in 2018, rising over 20-fold to 3,483 from just 162 in 2017, according to analysis of Financial Conduct Authority figures by Ludlow Thompson. It said high levels of competition in the mortgage business had pushed firms to react “to the demand for lower monthly outlays by providing increasingly long-term mortgage products”. "The huge increase in longer term mortgages is a much-needed addition of innovation to the mortgage market," said Ludlow chair Stephen Ludlow. "Many individuals who are getting on the ladder at 30 now expect to be working still well into their 70s so stretching their mortgage out makes perfect sense."
Metro in talks to sell off £500m of mortgages
Sky News reports that Metro Bank is in talks to sell £500m of mortgages back to US hedge fund Cerberus in a bid to shore up its capital position. The sale would mark a move away from Metro's increase of its loan-to-deposit ratio. Metro Bank’s CEO Craig Donaldson revealed in May that the lender could sell loans to cope with the fallout from its accounting error, meaning it is unlikely to surprise the market.
HOUSING
Inspections crisis could mean home extensions being pulled down
Hundreds of loft extensions, basements and other structural work face being torn down because of a crisis in building inspections arising out of the Grenfell Tower disaster. The crisis has led to private building inspectors, known as Approved Inspectors (AI), being unable to obtain insurance, which in turn means local council officials take on responsibility for inspecting newly built homes and extensions. unless the AIs can provide satisfactory documentation to show councils that the building work meets standards, then local authority inspectors can order the structures to be dismantled so they can be re-examined.
House firms building future slums, minister claims
A row has broken out after a Welsh Government minister accused the private house-building industry of creating the "slums of the future". Housing minister Julie James complained about "substandard" developments, saying: "I want the private sector to stop building the slums of the future, because we have driven some developments here in Wales that I think in eight years' time we will have a whole pile of problems in.” Her comments came as latest figures showed that Wales has seen the biggest fall in house-building since the recession nearly a decade ago. The number of new dwellings completed in 2018-19 was 5,777, a drop of 13% on the previous year.
Land trusts helping regenerate communities
A feature in the Times looks at how a community land trust is helping regenerate the Anfield area of Liverpool. In July, Liverpool City Council granted planning permission for residents to develop an area to include eight homes and three new businesses as well as an extension to local company Homebaked. There are 253 such not-for-profit community land trusts in England and Wales, acting as micro-developers delivering homes and supporting small companies. In July 2018, the Government made £163m available to this sector to increase the number of homes built by communities. Almost 1,000 houses have been built thus far, with more than 5,000 in the pipeline.
TAX
Think-tank: Tax moves could ease housing crisis
A report from think-tank Onward has outlined a number of measures it says could tackle the housing crisis, including new taxes on second homes, empty properties and houses bought by foreign investors. Onward wants a 1% tax on homes empty for six months or more, a rise in stamp duty for second home and foreign buyers, and an end to council tax relief for second home owners. It also proposes taking 770,000 properties a year from the stamp duty regime by scrapping the levy on homes priced up to £500,000.
Second homes tax could be overhauled
The additional dwelling supplement (ADS) in Scotland could be overhauled amid concerns that some owners are being unfairly overcharged. Public finance minister Kate Forbes has said she is "sympathetic" to concerns that hundreds of people, including first-time buyers, are being hit by the "anomalies" in the second homes tax, which was introduced three years ago and intended as a levy on buy-to-let landlords and people buying holiday homes.
RENTAL
More landlords create companies
Over 10% of privately-rented homes are now let by a private company as the sector continues to "professionalise". Scotland was just behind London as having the highest percentage of privately rented homes let by company landlords, 12%. In London the figure was 13%, and in Wales 8%, according to research from Hamptons International. It estimates that company landlords own 641,480 homes in Britain – 42% more than in 2015.
INDUSTRY
FCA cleared Lendy despite mis-selling
The Times claims that the Financial Conduct Authority knew Lendy, the crowdfunding marketplace for loans secured on UK property, had been mis-selling loans when it granted the peer-to-peer lender regulatory approval before its collapse. The regulator reportedly asked Lendy to compensate customers over loans that ordinary investors were misled about before granting the platform full authorisation a year ago. A spokesman for the FCA said: "At the time of authorisation the remediation programme was progressing as planned."
Property ‘old guard’ bows out as big changes loom
A number of ‘old guard’ property bosses from retail to office sectors are retiring, as the industry faces headwinds in the form of declining values and increasing M&A activity.
LEGAL
Developer tells residents to drop legal action or pay for fire watch
Residents stuck in tower blocks with Grenfell-style cladding have been told to drop their legal action or be forced to pay for fire wardens. Leaseholders of flats in the New Capital Quay development in London launched a group legal claim earlier this year against Galliard Homes and the freeholder Roamquest over the fire safety defects in their homes. Residents have now been told that if they continue, Galliard will charge them part of the cost of a 24 hour waking watch – in place to guard the buildings because the cladding is yet to be removed – that is not being covered by their insurers, understood to be around £1.2m.
Property tycoon faces bankruptcy
A property tycoon is expected to be made bankrupt after a four-year battle with creditors. Moises Gertner, whose empire in the City of London collapsed in the aftermath of the financial crisis, had tried to agree a settlement with creditors to repay 3½p for every £1 owed. But Nicholas Briggs, a High Court judge, refused to back the settlement and approved a bankruptcy petition against Mr Gertner that was filed by CFL Finance, an Israeli lender that was owed £12m.
LEISURE
Fewer pubs are closing down
Around 40 pubs closed down over the first half of the year, new figures show. A total of 235 pubs vanished across Britain in the six months to June, according to the latest research by real estate data company Altus Group. However the rate at which they are disappearing slowed down by almost half from last year on the back of recent government support. Nevertheless, the number of pubs in England and Wales was 41,301 on June 30, representing a fall of 1,149 pubs over the past 18 months.
INFRASTRUCTURE
Cardiff Central railway station to get £58m upgrade
Wales' busiest railway station will be "significantly" upgraded and a new station will link the west to the south, it has been announced. UK Transport Secretary Chris Grayling said £58m would be spent on revamping Cardiff Central and West Wales Parkway would be built in Felindre, Swansea. The Department for Transport said the upgrades would ease crowding and congestion during peak periods. Annual passenger numbers are predicted to rise from 12.7m in 2016 to 32m by 2043.
ECONOMY
Consumer confidence down
A report from Deloitte shows that consumer confidence fell deeper into negative territory during the second quarter of the year – down by four percentage points to -8% compared with the same period a year earlier. Ian Stewart, chief economist at Deloitte, said: "Consumers' finances are in good shape thanks to a long boom in jobs and strong wage growth. That said, uncertainties about Brexit and growth are weighing on consumer sentiment and their spending plans."
OTHER
North most affected by decline in coastal young
BBC analysis of population projections has found that more than half of England's coastal communities could see a decline in the number of residents aged under 30 by the year 2039, with towns in the North the worst affected. The research involving ONS data suggests every local authority in the North with a coastline, except Liverpool, might see a fall in the number of young people. In contrast, coastal authorities in the south could see substantial rises in the number of young people. The Parliamentary Group for Coastal Communities said funding cuts meant seaside towns were "being left behind".
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