Selected Recent News

Here are this week's news and views from the world of buy to let property. Articles this week:

• Libor rates approach 'normality'
• Buy-to-let market 'showing signs of stabilising
• Buy-to-let loan advances down 70%
• FT's cautious view on the housing market.
• Sarah Beeny: "Estate agents will be extinct in ten years"
• UK housing market, the untold story.

Latest News

UK housing market, the untold story.John Charcol mortgage expert Ray Boulger has written up his thoughts on the Treasury Select Committee’s brief on the housing market, Mortgage Arrears and Access to Mortgage Finance. He makes some very lucid, if disconcerting observations.

Libor rates approach 'normality'. This is great news for borrowers as it should enable banks to lend at more competitive rates - whether they will fulfill their end of the bargain by lending at cheaper rates remains to be seen though. (Not sure what the Libor rate is?)

With fewer landlord reposessions and receivers of rent appointed versus the last three months,the buy-to-let market is 'showing some signs of stabilisingHowever, remortgaging is still as difficult as ever with just 7,790 remortgages recorded this quarter.

Shelter forecasts a second wave of arrears and repossessions. "The economy remains weak and with unemployment still growing, arrears and possessions are likely to rise in the second half of the year"....

Buy-to-let loan advances down 70%from last year in the second quarter of 2009 according to figures from the Council of Mortgage Lenders (CML).

Market report on property prices.The Times has taken the views of a cross section of housing market experts to give their latest opinion on where the market's going and when.

The FT seems to have made up its mind though - and I'd tend to agree with their main points.

Sarah Beeny: "Estate agents will be extinct in ten years" A nice thought!

Maximum fine for buy to let landlord after tenant dies in bathroom tragedy.Very sad cuationary tale for landlords...

There was no news update last week due to holidays, but to make up for it, this week's edition has more content than ever with a carefully chosen selection of articles to keep you up to date with what's happening in BMV property. Including:

• The Royal Family buy BMV
• Have House prices found their level?
• The quietly ticking unemployment timebomb.
• Student Property performing well
• Central London prime yields fall below 4%
• Demolition team flatten wrong house.

Latest News

Have house prices found their level? The Times looks at the evidence.

Good news! The worst of the recession is over according to the British Chambers of Commerce The usual "we're not out of the woods yet" type caveats still apply - particularly regarding unemployment - but this is positive news nonetheless.

Speaking of unemployment, this is clearly one of the biggest issues facing buy-to-let landlords over the next couple of years. Umemployment usually lags behind other economic indicators and most forecasts seem to agree that it will peak at over 3 million in the 3rd quarter of next year.

The Telegraph reports melodramatically on the "quietly ticking unemployment timebomb" and according to ARLA, there has been a 65% rise in member agents reporting tenants with difficulties meeting their monthly rent payments.

Landlords appear to have taken this on board though and are getting much more fussy about who they let their properties to.

Anecdotally, A lot of investors we have been speaking to are also looking to LHA tenants and rental insurance to try and insulate themselves from the unemployment risk.

Student property continues to perform strongly with Britain’s biggest student housing developer reporting a 4.1% rise in the value of its fund in the second quarter

Big boys look to get in on the action in the residential motivated seller market with a new fund of £50m to float in September.

Central London residential investment yields fall below 4% (according to Knight Frank's Prime London Investment Index). Apparently, residential rents in central London fell 1.9% in the three months to June 2009, but prices actually rose by 3.7% - thus putting downward pressure on yields.

“It has been the more expensive properties which have borne the brunt of the rental falls - with rents on properties costing up to £500 per week falling only 11.3% over the past year, and those costing over £1500 per week falling by 27.3% over the same period.”

If prices are falling and rents are falling too then it sounds to me like prime London property isn't the place to be.

Finance News

Mortgage brokers predict "significant pick up in business" over the next few months.

Northern Rock starts to offer mortgages again to existing customers. Funnily enough, 125% products are off the menu.

RBS has launched three new fixed rate products specifically targeted at first time buyers looking to take advantage of one of the Governments shared equity schemes to raise a deposit. With the surge of first time buyer interest over the last couple of months, and now the finance to back it up, it looks like shared equity schemes may start to become more popular.

Other News

The Royal Family buy BMV!!  

GPS guided demolition team flatten the wrong house. Owner is understandably a little upset.

Useful Links

Upad have launched a new website that “guarantees” to find you a tenant for £59. Management and/or rent collection can be included at extra cost.

Property expert and TV personality Sarah Beeny has launched a site for homeowners to sell their property without incurring fees. Interesting idea, so it's worth checking out here: www.tepilo.com

The normal buy to let news and links follow below, but first off this week, an important note for those of you involved - or looking to get involved with Sale and Rent Back (SARB).

You need to be aware that SARB will soon be regulated by the FSA.

To get yourself up to speed on the requirements, you need to check the Rent Back Charter FSA Authorisation and Support Service. Some of the readers of this newsletter have been instrumental in setting this up and it is the best/only source of reliable information on the subject for now.

At the website, you can register for FSA Fitness Healthcheck workshops as well as get some details about what to expect and who is involved.

Now the news....

Latest News

Despite some signs of recovery -- house prices rose by 1.2% in May, the second rise in three months, according to Nationwide -- globalarbtrader, a contributor to the Motley Fool forum, thinks any bounce in the market will be short lived. His views are backed up by some interesting statistical data which gives them some weight.

This rather bleak article from Property Wire supports the main thrust of his argument too.

As does the fact that mortgage lending was 2% down in May and a whopping 58% down on this time last year.

Which is not all that surprising seeing as "up to 80% of mortgages approved by Halifax Bank of Scotland prior to the credit crunch were accepted without any proof of income", according to a former senior employee.

A new VAT ruling by the EU on a Czech cleaner's bill (of all things) means that buy-to-let landlords will soon have to face new VAT laws.

But on the bright side, homeowners are 25% better off this year compared to 2008, due to low interest rates which have slashed mortgage costs.

This seems to be backed up by a Bank of England trends report which reveals that, despite the significant fall in the base rate of interest, there has been no significant rise in the amount homeowners are paying off their mortgages each month.

And if you haven't fixed your mortgage rate and are in a position to do so, Citywire says do it now.

In other news, Taylor Wimpey's order book is up 73% on the begnning of the year to just under £1bn.

Now that 57% of local authorities are seeing more people in need of social housing, the Local Government Association, which represents more than 350 councils in England, has launched a major new housing campaign to give councils the freedom to build scores of new affordable homes and regenerate neighbourhoods across the country.

New high speed train brings Canterbury into easy commuting range of London.

If you're tired of investing in a depressed property market, and looking for capital growth in a booming property market - look no further than Sudan. With a bit of luck they might send Sarah Beeney over there.

Useful Links

The Estate Agents Public Register provides details of estate agents who are currently banned from engaging in estate agency work or who have received a formal warning under the Estate Agents Act 1979.

This week's updates cover a bit of bank bashing, the return of the first time buyer and, for the more technical out there, some detailed analysis of the current economic picture.

The events calendar on the website has also now been updated to show you all of the property networking events we know about across the UK.

Latest News

Buy-to-let borrowers warned about lenders' tactics. The Residential Landlords Association (RLA) has warned buy-to-let borrowers that lenders may try to change their borrowing rates as property values fall. Make sure you check the small print on your deals.

Mortgage rates are becoming increasingly decoupled from LIBOR and the Base Rate. Banks are making ever widening margins at the borrowers expense. In light of the first article about sneaky buy-to-let tatics, the taxpayer bailout, Goodwin-gate and so on... it's all starting to become a bit hard to swallow.

But then, having messed things up so royally, you can see why they need to do it...Banks are potentially going to be faced with £100bn of losses on commercial property which is expected to halve in value from peak prices according to Jones Lang LaSalle. In the context of the huge sums being bandied around these days, it's easy to lose perspective on how much money this is, but it's more than the entire market cap of RBS, Barclays and Lloyds combined!

Enough bank bashing (for now), first time buyers look to be well and truly back in the market with some great fixed rate deals at up to 90% LTV and trackers up to 95%. Mortgage brokers say that the FTB market will really pick up in the next two months.

The acute shortage of homes for sale has begun to support house prices, according to RICS.Estate Agents have reported that buyer registrations at the highest level since August 1999.

For the more technical amongst you, this is an excellent analysis of the UK housing market at the moment - lots of graphs and very well informed comment.

If you like that sort of thing, then this report on the UK economy as a whole at the moment - including the housing sector - is also well worth a read.

On a lighter note, here are 'the 10 worst property investments ever'. If you're having a bit of a tough time with your portfolio at the moment, these ought to make you feel a bit better!

Useful Links

Don't forget to check out our list of this month's property events here.

Check out the Tax Insider website here - I've just subscribed and the tips and advice have been well beyond my expectations. Don't just rely on your accountant, to minimise your tax bill, you need to educate yourself too.

A lot of mixed messages in the property news this week - some horrible results for British Land (the largest portfolio owner in the UK) with a 64% decline in net asset value, buy to let lending is down again, but on the other hand, residential property asking prices are up 2.4% according to Rightmove, gazumping is back in London and the South East and rates look like they'll stay on hold for a while to come yet.

Latest News

Good news for homeowners as Bank of England reveals interest rates won't rise for months according to the Daily Mail's interepretation of the minutes of the Monetary Policy Committe.

Bottom end properties hit hardest with properties in UK's best locations retaining their value better

Anatole Kaletsky, a highly respected economist with the Times, thinks the housing market may just be on the turn

Landlords lose deposits as lettings agents go bust. The tenancy deposit scheme only protects the tenant it seems.

Just 22,400 buy to let mortgages were advanced in the first quarter of this year - down over a third on the previous quarter.

Imagine a lender that only charges you an arrangement fee that reflects their true costs and donates any late payment fines to charity... There's a lot to be said for Islamic mortgages...

Asking prices in England and Wales rise by 2.4% in May - although I think this might be a triumph of optimism over reality.

Especially given that mortgage lending fell by £1bn in April on the previous month.

It looks like gazumping is back though with a shortage of property on the market.

Instant property millionaire companies shut down