House price growth

The increase left the typical UK home costing £205,846, according to Nationwide

What’s the latest?

House price growth sped up in February with property values climbing by 0.6%.

The increase, which followed a 0.2% rise in January, left the typical UK home costing £205,846.

The annual rate at which house prices are increasing also picked up slightly during the month to stand at 4.5%, compared with 4.3% in the year to the end of January, according to Nationwide Building Society.

Why is this happening?

Nationwide said the housing market continued to be supported by the UK economy, which remained relatively strong.

Economic growth accelerated slightly between October and December, while the unemployment rate remained stable at an 11-year low of 4.8%.

But the group warned the outlook was uncertain, and the economy was likely to slow down during 2017, with consumer spending hit by the weaker pound.

Robert Gardner, Nationwide’s chief economist, said: “Nevertheless, in our view a small rise in house prices of around 2% is more likely than a decline over the course of 2017, since low borrowing costs and the dearth of homes on the market will continue to support prices.”

image: https://st.zoocdn.com/zoopla_static_cms_content_cms_document_assets_(426074).jpeg

Home for sale in Ascot.Above: four-bedroom home on Kings Road in Sunninghill near Ascot 

Who does it affect?

The fact that the heat appears to have come out of the property market is good news for those looking to buy a home as it takes off some of the pressure to purchase somewhere quickly.

But the ongoing shortage of homes for sale continues to be an issue as it limits choice for potential buyers.

The fact that house price growth is expected to slow further may also have an impact on stock levels, as homeowners are more likely to put their homes on the market to ‘test the water’ during periods of strong increases in property values.

Sounds interesting. What’s the background?

Nationwide said there had been a significant increase in the proportion of people buying property with cash during the past decade.

It said cash transactions had soared from just 20% of all purchases in 2005/2006 to around 35% now.

But Nationwide said the rise was driven by a decline in mortgage lending, rather than a jump in actual cash transactions.

Even so, the share of cash buyers has not fallen back as the economy has recovered and lending has picked up again.

The level of people buying with cash peaked at 38.9% in the first quarter of 2016 as investors rushed to complete purchases before new higher stamp duty rates came into force in April.

Top 3 takeaways

  • House price growth sped up in February with property values climbing by 0.6%.
  • The increase, which followed a rise of 0.2% in January, left the typical home costing £205,846.
  • The annual rate at which prices are increasing also picked up slightly during the month to stand at 4.5%, compared with 4.3% in the year to the end of January.

What’s the cost of buying a home ? lets have a look

What’s the cost of buying a home?

buying a houseSo, you’ve spent more time than you care to admit on Rightmove homing in on the ideal area for you to live. You’ve seen one too many floorplans, fallen asleep dreaming of furniture placements and started making colour charts for the prospective kitchen…

 You’ve decided to take the plunge and buy a home so let’s get this show on the road!

The next step is to talk money but, as a first-time buyer, what fees do you need to think about that might not have come to mind yet?

Deposit

This will normally be around 5% – 20% of the property price which you will pay upfront to your solicitor, to secure the property. You want to get together as big a deposit as possible in order to get the best mortgage rates.

Mortgages

You will need to speak to a Mortgage Adviser to find out how much they will lend you. The amount will depend on your salary, the size of your deposit and credit history. If you’re not planning to buy immediately, there are several things you can do to improve your chances of getting a better mortgage i.e. you may get a better interest rate if your credit rating is better.

There are many things to think about when selecting a Mortgage Adviser – such as whether to go through a broker or direct to the lender. Although their rates will be different, it is more important to look at which will support your personal circumstances the best. Regardless of whether you go through a broker or direct, the adviser should be able to present you with a shortlist of options based on your personal situation to make life easier for you when deciding which to go with.

The other fees you can expect to see, at this stage of the process, are mortgage arrangement fees (which you can pay upfront or roll it into your mortgage repayments), mortgage valuation fee, broker fees and conveyancing transfer fee.

Get a step by step guide to mortgages with our Mortgage Hub here.

Stamp Duty

Stamp Duty isn’t just for the millionaires amongst us – it is a charge on any home if the property costs over £125,000. You can see Stamp Duty charges for a particular home price with this calculator here but, in a nutshell, this is how it works:

If the purchase price is £275,000, stamp duty is calculated as follows:

0% on the first £125,000 = £0

2% on the next £125,000 = £2,500

5% on the final £   25,000 = £1,250

Total stamp duty payable = £3,750

Be aware: this is the way stamp duty is calculated if this is your only home, but if it’s a buy to let investment or a second home, different rules apply.

Valuation and surveyor’s fees

The next step is for your mortgage provider to create a mortgage valuation report on the property as a means to check its market value and condition. There are three different report tiers to choose from, ranging from the most basic “Mortgage Valuation”, to the most comprehensive “Buildings Survey”. These may seem like an unnecessary fee, but it’s better to be fully aware of any potential problems you may face in the future with the property, before going any further with the purchase. You will usually be required to pay upfront for the cost of whichever report type you choose. Find out about the three different options below:

Mortgage Valuation – This is required by all lenders and is the minimum level of report required. The report checks that the property‘s cost is in line with current market values, as well as other basic checks.

Homebuyer’s Report – This is a much more detailed version of the Mortgage Valuation. In this report, they will look at all visible aspects of the home and recommend changes as well as any causes for concern. This may be easiest and cheaper if you use the same person who is doing your Mortgage Valuation.

Buildings Survey – This is the most detailed kind of survey. Recommended for older structures, period properties or homes which have had alterations (or which you plan to renovate), the surveyor will look thoroughly for problems with damp, within the roof and structure, rotting or with the foundations etc. They will also provide you will estimate prices for maintenance work.

Remember: when you’ve received your report, don’t just put that onto your pile of paperwork – make sure you read it and understand it thoroughly before you proceed with the home buying process.

Solicitor fees

A solicitor will be needed to help with the legal side of buying a home and may offer other services, such as local searches – which check out if there may be any local plans or issues going on which could affect you as a prospective owner. They will also charge for solicitor fees, disbursements and Land Registry fees – so these fees could rack up. Have a look at this calculator to see what your expected legal fees could be.

It is, again, important to do your research into several solicitors to pick the right one for you. The more expensive ‘no sale, no fee’ option is great for protecting yourself incase the sale falls through or you could get a much cheaper option but you will still have to pay their fees if the process is halted. Also, do you want a local or a call centre-type service? A local solicitor may be slightly more expensive but they may have more local knowledge and you can go in and pester them if you want to push the process along!

And when you’re ready to move…

That’s a blog for a different day, but you’ll need to keep some funds aside for removals companies (use our local removals tool here), ground rent if you’re buying a leasehold flat, the cost of changing the locks and house insurance, once you move.

There may seem like a lot of costs here, but it’s best to know what you’re dealing with and what the options are upfront, so you can make sure you have saved enough before you start and you don’t have to cut corners. It also means you  can do the necessary research and know your options when it comes to picking solicitors and mortgage advisors. Why not print this list off and tick them off as you go along? Good luck with your move!

 

Faster house price growth in November, says the Halifax

Terraced house

Annual growth in UK house prices accelerated for the first time in eight months in November, a lender’s figures show.
The Halifax, part of Lloyds Banking Group, said property prices had risen by 6% compared with a year ago.
That meant the cost of a typical home was £218,002, it said.
The faster price growth is in contrast with figures from rival Nationwide, which said annual house price growth had slowed to 4.4%.
Annual property price growth peaked at 10% in March. The Halifax said that, despite the pick-up it reported in November, “annual house price growth may slow over the coming months”.
‘Putting the boot in’
Prices were up by 0.2% compared with October, and had risen by 0.8% in the three months to the end of November compared with the previous quarter, it said.
Industry figures welcomed the pick-up in prices.
Russell Quirk, chief executive of eMoov, said: “Many in the industry have been quick to put the boot in over the last few months where the UK property market is concerned, hanging gloomy predictions on a dwindling level of demand in the market.
“It would seem this simply is not the case. The driving factor behind inflating house prices is an imbalance between supply and demand and, with house prices spiking this late in the year, it would seem there is certainly a sustained level of buyer demand present in the current market.”
Jonathan Hopper, managing director of Garrington Property Finders, said: “The Halifax’s market confidence tracker illustrates perfectly the ‘business as usual’ stoicism. It found consumer confidence in the housing market is at its lowest level for three years, but that nearly four times as many people expect prices to rise as think they will fall in the next year.”
The Halifax said that low mortgage rates were maintaining demand among potential buyers. But HSBC has just pulled one of the cheapest deals – a 0.99% two-year fixed-rate deal off the market.
Mortgage broker Aaron Strutt, of Trinity Financial, said the lender was inundated with enquiries, which could have led to it being withdrawn, despite the relatively high arrangement fees connected to the deal.

10 tips to help sell your house!

10 tips to help sell your house!

 

 

It’s all about property presentation; trust me when I say that this is key.

Homes are our biggest asset, naturally we expect a good price and yes under the right circumstances it should be possible to get it. Let me tell you if you put your property on the market with the “let’s see what happens” attitude you are not likely to achieve your price expectations.

Would you sell a car without giving it a quick wash and brush up? No, so why do it when trying to sell your home?

Getting the buyer to connect with your home, to imagine how it will suit their family and lifestyle, is not just luck; it’s about creating the right environment so they can’t resist it.
It’s extremely important that each room appears as it is intended to be used. Imagine the mindset of a potential buyer of a three bedroom house seeing two bedrooms plus a storage room!
And why do vendors think they are doing potential buyers a favour by showing them their home? It might take multiple viewings and can be wearing but it has to be done at a time convenient to the buyer not just the vendor.
To sell your home in today’s marketplace follow these few simple tips:
1. Good landscaping will transform the exterior look and feel of your home and give you a higher price. Hire a landscaper or do it yourself.
2. Your front door is the centrepiece of your kerb appeal so repaint it in a tasteful colour. Update the outside lights and put potted plants on either side of the door.
3. The entrance hall creates a first impression… make sure it is the right impression. Paint it in a neutral colour, remove any bulky furniture, upgrade the lighting and if you feel you need colour add it with accessories and a rug.
4. The wrong lighting can make your home feel dark and drab so install brighter modern lights to make your home seem sunny, cheerful and up to date.
5. Paint colour is such a personal choice and potential buyers are likely to want to customize it themselves. If you have dark rich colours then repaint in neutral hues.
6. Avoid major overhauls, especially in the kitchen and bathroom, but do update the lighting, install new faucets, mirrors and doorknobs if they are dated.
7. Clutter. NO, NO, NO! How do you expect to impress potential buyers with a cluttered house? If you have outgrown your home, start packing and if you don’t have anywhere to put it then use storage.
8. Pets – some love them, some hate them and some are allergic to them, so make sure that on the viewing they are out of they house to prevent one of three things happening:

    – Pet lovers will pay more attention to your pet and less attention to your home.
    – Pet haters will feel uncomfortable, completely on their guard and rush round your property leaving as soon as they can.
    – If you have a buyer that is allergic to animals, a reaction will put them off your home. Remove all pet bowls, baskets and (most important) litter trays.

9. Back garden. The first thing people see when they walk out the back? An unkempt garden? Loose concrete slabs? Your back garden should look like a space for entertaining. If need be, buy inexpensive patio furniture, potted plants and install some outdoor lighting to tie it all together.
10. Clean – Buyers expect to see an immaculate home with no signs of dirt. Remove last night’s Indian take away from the worktops and do the washing up! No dirty underwear on the bedroom floor. Potential buyers need to imagine themselves living in “your” space, your perfectly clean home!
You’ll be surprised how big an impression these small updates can make. By the time you’re done, you’ll wonder why you didn’t do it sooner.
Follow these small steps to help maximise your property’s potential that will allow you to achieve a faster sale and the best possible market price for your home.

247 Property Agent Ltd