CBI calls for more action on housing market

I was interested to read the speech by John Cridland,  Director General, CBI (Confederation of British Industry), calling on the Chancellor to make the housing market the central plank of this month’s budget.  The CBI are calling for a 50,000 new affordable houses to be built, incentives for refurbishing empty homes, the housing guarantee scheme to be extended to all types of housing and, perhaps most controversially,  the new buy scheme being extended to allow second time buyers struggling to get on the next rung of the property ladder.

I am delighted that the CBI are calling for more action in relation to the housing market although I am not sure that extending the new buy scheme is the best way to do it.  The new buy scheme solely focuses on new build houses. I would welcome a plan to assist first time buyers buying any type of property as I think this would lead to a more sustainable improvement in the housing market. Whatever happens I hope that the Chancellor uses his budget to actively encourage and support the housing market leading to huge benefits for the economy as a whole.

I look forward to reporting on the budget in due course.

Lindsay Darroch
Partner – Head of Property

Mixed Messages From Mortgage Market

The latest Bank of England figures show that Banks and Building Societies cut lending by a net £2.425 billion between October and December, 2012.  This includes lenders who are taking part in the funding for lending scheme.  While I am noticing an increase in activity in mortgage lending, I know from speaking to a number of mortgage advisers that deals are taking longer to get through and that every box requires to be ticked before the lender will process the application – perhaps no bad thing!

Money Facts have recently called on lenders to re-open their books to first time buyers to get the property market moving.   Sylvia Waycot, editor at Money Facts, said “we have seen the first time buyer market stagnate as deposit demands become unrealistic.”  The latest significant changes the Government’s funding for lending scheme, which seems to put everything back on track – but only time will tell if this works out as planned.  We are already seeing the forward thinking lenders into the markets with innovative products to help first time buyers to get onto the housing ladder.  It looks as though we are about to enter yet another period of change within the mortgage market, and at last it might be for the better.

I hope the Government’s funding for lending scheme works as planned and the Chancellor takes the budget opportunity to do more to assist first time buyers.

Lindsay Darroch
Partner & Head of Property

 

Blackadders Property Team – Record Sales Month – February

I am delighted to report that the Blackadders Property Team had a record sales month in February being more than 30% up on February last year.  This is a very positive sign and hopefully points to the start of a sustained recovery in the housing market.  One interesting trend however is that listings i.e. properties coming onto the market are not increasing to the same extent, my indicators point to the total for January and February being round about the same as last year.  Hopefully the increase in sales will start giving people the confidence to put their own properties on the market.

I do think more could be done.  More substantial help is required for first time buyers as this will increase the free-flowing nature of the property market.  I think that 2013 will be a transitional and improving year however my only notes of caution are in relation to the recent Italian general election which proved inconclusive and could lead to market uncertainty and could have an impact on lending. I am also watching with interest the debates in the United States in relation to their budget.  At the time of writing this blog the USA has still not agreed the budget deal and look to be heading towards the fiscal cliff which could have huge negative impact on the global economy.

2013 will be a very interesting year!

 

Lindsay Darroch
Partner – Head of Property

 

P.S. I am also pleased to report that over the last couple of months I have been involved in discussions with a number of banks in relation to businesses looking to buy their current premises or in fact move to new premises and the discussions with the banks in questions have been a lot more positive with the banks taking a more sensible and pragmatic view in relation to risk and also deposit requirements.  I think this is another very positive sign.

Chartered Institute of Housing Write to Chancellor

As readers of previous blogs will know I have been urging the Government to do more to support the housing market as a means of stimulating the whole economy.  The Chartered Institute of Housing have written to Chancellor George Osborne ahead of next month’s budget with a    4 point plan    which they say will generate billions of pounds and support more than 20,000 jobs.  Their plan includes a Stamp Duty holiday for Landlords, a plan to provide long-term certainty on rents in the affordable housing sector, allowing the Local Authorities to borrow more money to invest in developing new homes and increasing the discretionary housing payment budget.

I hope the Chancellor listens to these requests and comes up with an imaginative and positive plan for the UK housing market.  I look forward to reporting on the budget next month.

 

Lindsay Darroch
Partner – Head of Property