September 2010 Southend property market up date

Sales
According to a recent report conducted by YouGov for the Council of Mortgage Lenders (CML), 85 per cent of those surveyed said they wanted to live in homes they own over the next ten years, in 2007, this figure was 84 per cent.
Homebuyers will also be pleased to hear that houses for sale in the UK are much more affordable now than they were two years ago. There has been a drop in the proportion of salary homeowners spend on mortgage repayments from 17 per cent of a homeowner's earnings to just 9.6 per cent.
National house prices showed little change in the latest figures released by the land registry, in August prices were down just 0.3% making the annual average house price increase across the UK 6.7%.
In Southend the last two months have shown small price decreases making the average detached house price now £319,755 with a semi detached at £200,271 and terrace houses £149,801. August prices became more affordable, reducing by -1.0% making the annual change + 8.2%.
Meanwhile, house sale volumes are currently running at about 60% of their peck activity of 103,180
Rental
Landlords are unlikely to reduce their rents in order to make room for the proposed housing benefit cuts. This is the opinion of the Residential Landlords Association (ARLA), which stated that the government's plans to reduce the local housing allowance (LHA) will prevent claimants from being able to live in 70 per cent of rental accommodation. Alan Ward, chairman of the RLA, revealed that 75 per cent of landlords with buy-to-let properties will "not be prepared to reduce their rental levels". He also stated that 54 per cent of landlords said the proposed cuts will make them stop letting to housing benefit claimants. The National Landlords Association recently reported that the reductions to the LHA could result in up to 90 per cent of landlords being less likely to take on claimants as tenants. More than one million people, who currently receive housing benefits, can expect to receive a reduction in LHA of £12 per week if the proposals go ahead.
Landlords could take up a new offer from The Mortgage Works. Yesterday (September 15th 2010), the mortgage provider announced it has made changes to some of its buy-to-let products. These include rate improvements of up to 0.6 per cent on some fixed-rate products, giving £1,000 in cash back for first-time landlords and providing a zero arrangement fee option. It has also introduced a new 75 per cent loan-to-value first-time landlord and let to buy product. Nationwide's director responsible for mortgages Andy McQueen said: "These new changes will further strengthen our product … We believe we're offering the increased clarity, variety and flexibility needed to ensure that intermediaries can satisfy the ever changing needs of their clients." Last week, the National Association of Estate Agents suggested there could be more people looking for buy-to-let properties after it said that the future for the market looks good.
Mortgages
There has been some positive news in the Mortgage Market recently, with Abbey, Alliance and Leicester and Nationwide all reducing the cost of mortgage funding across their product range on products from 60% LTV up to 90% LTV.
Last week also so the emergence of a brand new lender to the UK mortgage market, with the launch of Precise Mortgages, who have launched as an Intermediary only lender. Any new lenders entering the market can only be seen as a very positive sign of recovery for the UK mortgage market.
Further more, Paragon have also announced they will return to lending again with the launch of a new range of Buy to Let mortgage products. These will be the first new buy-to-let mortgages that Paragon has offered since February 2008 when it withdrew from the market due to conditions in the global financial markets.
All this is good news for the buy to let investor, but what is really needed now is an increase in availability of higher loan to value mortgage deals for First Time Buyers, as there are still only a small handful of lenders offering mortgages up to 90% loan to value and they are not currently priced in line with the current historically low bank base rate.
Tudor’s in house mortgage broker, Kit Thompson, of Amber Mortgage Solutions offers whole of market mortgage advice and no broker fees. Please contact him on 01702 346818 or 07896 981380. Email: kitthompson@ambermortgagesolutions.com

If you require any further information about the property market go to www.trustintudor.co.uk or call our property specialists on 01702 346818

Alan Kirkman Director Tudor Estates created 1st October 2010