Property Rescue Blog

The dramatic falls in property prices over recent months have left many homeowners in negative equity – in other words, owing more on their mortgage than their property is worth.

The Financial Services Authority certainly agrees that negative equity is a real problem.  It states that as many as one in five households could face negative equity by the time the market bottoms out, with an estimated overall fall in prices of 30% from their 2007 peak.  These figures mean that some 2.5 million loans will be in excess of the value of the property against which they are secured. 

Short term negative equity is not necessarily a huge problem for those who are prepared to stay put and sit out the downturn.  There are things that can be done by homeowners to minimise the impact, one of which is to make higher mortgage payments thus paying less interest on the loan overall.  In a market where interest rates are low this could be an option for those who have cash to spare.  If the market recovers relatively quickly the period of negative equity may be short.  There are signs that lenders are starting to ease up on mortgage restrictions, which could get house sales moving again.  With strong encouragement from the Government, Northern Rock and RBS/Lloyds Banking Group are increasing the number of mortgages they are making available and the British Bankers Association has reported that mortgage lending increased slightly during January, although to put this into context it was still some 43% down on the previous year. 

For homeowners who have to move house or who are having trouble meeting their mortgage repayments the negative equity trap can have serious consequences, compounded by the fact that selling up can be a difficult and lengthy process during which mortgage arrears escalate. 

It may seem that the homeowner has little choice in such circumstances other than to allow their home to be repossessed.  But repossession is far from an easy way out and should be viewed as a last resort because of its ongoing consequences in terms of future borrowing and effect on personal credit ratings.  Far better to sell the home and prevent repossession.  But in an almost stagnant market, is this a realistic option?

There remains a certain way to sell your home despite the turmoil in the property and financial markets.  Property Rescue will give you a valuation for your home and, if you accept that valuation, will buy your property regardless of its location or the type of home it is.  Although no one can improve the current economic situation is it good to know that there is a guaranteed way of selling property in a crisis.

For more information contact Property Rescue.  All calls are in complete confidence and without obligation.

UK property prices are being driven down by pent-up supply and decreased demand. Since 2007, the UK property market has been struggling. These difficulties are expected to continue through 2009.

The Rightmove House Price Index saw UK residential property prices in May 2008 at an average of about 243,000 pounds decreasing gradually to December 2008 figures of 218,000 pounds.

For 2008, UK house prices have fallen 8.7%. Property researchers and banks have forecast declines of anywhere from 10% to 20% in UK property prices for 2009. The UK property price market remains volatile.

Hometrack's Director of Research Richard Donnell said the following in a December 29, 2008 report: "The onset of recession and the prospect of rising unemployment over 2009 will continue to damp confidence and in turn demand, which will inevitably lead to further house price falls over the next 12 months."

Average UK property prices differ depending on the region. Although, London was initially resistant to the economic downturn, it is now seeing worsening economic conditions compared to the rest of the the United Kingdom.

Some property agents believe that UK property prices have fallen between 15% to 50% from 2007. Property agents are more likely to reduce prices due to increased inventory, as houses remain on the market for nearly twice as long in 2008. There is also an increase in the number of unsold homes that have remained on the market for longer than a year.

The Council of Mortgage Lenders sees increased repossessions possibly up 66% for 2009. This will increase the pressure on UK property prices as more "forced-sale" properties become available.

Some of these property salesmen are shameless. Even contradicting all evidence, they will continue their refrain - "It is always a good time to buy and the property market will always increase" refrain. Don't buy this "bill of goods." What goes up, must come down. Sound common sense must always drive business decisions trumping marketing rhetoric.

The credit crunch will debilitate those with questionable credit ratings. Those with good credit and available liquidity should leverage their position to find a great deal. Many property bargains are available as UK property prices fall.

There should be many deals out there for the enterprising. Buyers need to know that they have the advantage. They should be able to negotiate better deals.

Over time, property builders will reduce the supply by cutting production on new property development. Gradually, supply will be diminished in order to better match demand. Timing is very important as the bottom of the UK property market is uncertain.

It is nearly impossible to properly time the exact bottom of a market. UK property prices are expected to continue to fall in 2009. The wise investor should use this knowledge to find the best deal out there.

The current condition of the UK property market has certainly raised eyebrows among the top industry analysts. After substantiating itself in the preceding years, UK home prices have taken a deep plunge after 2007. The decline has continued unabated for almost two years. New surveys conducted by Halifax and Nationwide have reveled that the property market has receded by almost 15 percent to 20 percent since the autumn of 2007.

Looking into the Future

Amid growing concerns over the global financial crises, it seems that this downfall might continue to drive the prices lower, even in the next year. How much lower is anyone’s guess but looking at the recent trends, majority thinks that the UK property market will continue to shed its current price by another 15 percent. This 15 percent decline in the year 2009 amounts to a drop of nearly 30 to 35 percent which is nearly 70 percent lower than the highest property values in this decade.

The average cost of a typical English house is £224,064 with total sales of 138,487 properties in this quarter. London and its adjacent boroughs have faced the brunt of the pressure where properties have plummeted to 10 percent since the last year. Yorkshire and Humberside are close behind with 6.5 percent and 6.6 percent declines in the last twelve months, respectively.

Why the decline?

The falling property prices are due to the growing job loss which has promoted house owners to sell their homes. Banks and other financial institutions have acted accordingly by further tightening the lending rules and squeezing the supply of money for the potential buyers, resulting in less demand for new homes. Responding to the situation, existing home owners are waiting for the prices to freeze as they are unwilling to sell at a loss. It is estimated that the average household moving is now almost, once in 31 years, in this decade which is double the time period from the preceding decade. Add to the shortage of buyers, new regulations by the property agents have made it a little harder to complete the purchase process which can take up to three months, double the time during the price boom in 2007.

Efforts by the UK government

The Bank of England and the government are trying to mitigate the crisis by cutting the interest rates, decreasing the LIBOR rates and keeping a well balanced credit supply. Such policies along with the recent gains in the financials of Nationwide by almost £1.5 billion is pointing towards the fluidity of the market and easing up of mortgage. One thing is for sure! There are still many people who are willing to cash on the recent slump by borrowing the houses and then expecting to raise a profit, later on. This human greed along with the efforts of British government, the recession may end sooner then expected.

When will it end?

The big question remains; When will the property market blossom once gain? Leading bankers predict that the property market will certainly get a much needed revival by the mid of 2009. It is during this period that people will likely see an increase in home sales. For more a circumspect figure by leading analysts, the UK property is likely to regain in the initial months of 2010.

Remortgaging is basically a process that allows a person to switch the current mortgage from the existing lender to some new lender. Remortgage or the fresh mortgage repays the existing lender and at the same time provides the borrower with an opportunity to raise supplementary funds at lower rates of interest than the existing mortgage. Remortgaging is in fact a wonderful option for those who wish to lessen their monthly payments, raise ample amount of capital or release equity in their house.

These days, people are remortgaging their homes as it allows them to get hold of better interest rates. There are innumerable benefits of remortgaging.

If any borrower had taken a loan when the interests were high then he or she can save money by switching to lower interests or remortgaging.

If the borrower is paying the lender’s SVR (Standard Variable Rate), then it is apt to change the existing deal to a better available product. This allows the borrower not only to save money on the monthly payments but also to repay the mortgage in lesser time. It is good if the better deal can be done with the existing dealer but if the current lender does not agree to offer better rates then the borrower can easily switch the mortgage to some other lender. In doing so the borrower may have to pay early repayment charges to the current lender but it worth paying these charges in order to gain net savings.

With a little search the borrowers can easily find multiple banks offering temptingly low rates of interest in order to attract business. Switching to some new lender allows the borrowers to take advantage of such deals to get diminished monthly repayments.

Sometimes the rates are low at the time of the deal but the experts predict a rise in next few months. With the tool called remortgaging the borrower can enjoy a deal at fixed rates. The borrowers have an option to “lock” the low rate of interest for the mortgage that stays the same for the next few years, no matter what the base rate undergoes.

Increase in income or rise in the value of property can be used by the borrower to elevate his/her mortgage that can be used for some major expenditure such as university costs of a child or weddings. Remortgaging is a better option than borrowing discretely and in some cases from a more expensive source.

Over the last decade a significant growth has been seen in the property prices. This is beneficial for those having a huge amount of equity in their house. Switching for a Remortgage upper than the mortgage balance can release a little of the equity for the borrower to spend. The best part is that this can be done at a lesser rate than any secured loan.

Remortgage is undoubtedly more convenient and cheaper and even allows the borrower to take care of several other expenses that can be paid for by the process of remortgaging. Thus remortgaging is nothing more than changing the existing deal into a more profitable one.

House prices in England and Wales fell by an average of 13.8% last year.  There are conflicting opinions on how the property market will fare as the recession deepens, although it is certain that substantial gains are out of the question.  Anyone embarking on the property ladder for the first time or trying to sell their home is in for a bumpy ride.

The 2008 price fall was the biggest drop the market has seen, even outdoing the famous 1932 depression.  Some parts of the country fared better than others with Wales only seeing an 8.6% drop, while the South West saw almost double that as a massive 15.6% was cut off the value of their homes.

The practice of taking out equity in the home, or re-mortgaging, has almost come to a halt as lenders become more cautious and homeowners are unsure as to what their property will be worth in a year or two’s time.  But is this caution justified?

On the one hand the signs that property values will fall further seem strong.  They include factors such as:

-    a worsening recession
-    an increasing number of company bankruptcies and personal insolvencies
-    a rise in the jobless figures
-    a lack of availability in the mortgage market
-    a belief that property was over-priced and still has some way to fall before it     achieves realistic values

The other side of the argument points to more positive signals, including:

-    a steady rise over the past six months of people wanting to buy
-    a bottoming out of the housing market, prompting people to buy now
-    a strong message from the Government that lending needs to start again
-    low interest rates, making mortgages more affordable

In fact, the situation is so complicated that two of the biggest lenders, Halifax and Nationwide, have declined to predict how the market will perform this year.  Likewise, the Council of Mortgage Lenders is not putting forward an opinion, arguing that there are too many unknowns to make an accurate forecast.  The most pessimistic commentators see prices falling continually through 2010, 2011 and even into 2012, but many others think that the economy as a whole will start to come out of recession during 2010 and therefore don’t agree with such a gloomy outlook.

People who need to move house are in an awkward situation.  How much is their property worth?  Is that figure going down or is it stable?  What’s the likelihood of finding a buyer, and will that buyer be able see the deal through to its conclusion?

There are so many unknowns in property sales even when the market is buoyant.  It is good to know that there is a way of selling your property regardless of the state of the market, and that is through Property Rescue.  They promise to give you a valuation for your home which, if you accept it, will lead to a guaranteed sale.

For information on how to sell your home fast, contact Property Rescue.

House prices in England and Wales fell by an average of 13.8% last year.  There are conflicting opinions on how the property market will fare as the recession deepens, although it is certain that substantial gains are out of the question.  Anyone embarking on the property ladder for the first time or trying to sell their home is in for a bumpy ride.

The 2008 price fall was the biggest drop the market has seen, even outdoing the famous 1932 depression.  Some parts of the country fared better than others with Wales only seeing an 8.6% drop, while the South West saw almost double that as a massive 15.6% was cut off the value of their homes.

The practice of taking out equity in the home, or re-mortgaging, has almost come to a halt as lenders become more cautious and homeowners are unsure as to what their property will be worth in a year or two’s time.  But is this caution justified?

On the one hand the signs that property values will fall further seem strong.  They include factors such as:

-    a worsening recession
-    an increasing number of company bankruptcies and personal insolvencies
-    a rise in the jobless figures
-    a lack of availability in the mortgage market
-    a belief that property was over-priced and still has some way to fall before it     achieves realistic values

The other side of the argument points to more positive signals, including:

-    a steady rise over the past six months of people wanting to buy
-    a bottoming out of the housing market, prompting people to buy now
-    a strong message from the Government that lending needs to start again
-    low interest rates, making mortgages more affordable

In fact, the situation is so complicated that two of the biggest lenders, Halifax and Nationwide, have declined to predict how the market will perform this year.  Likewise, the Council of Mortgage Lenders is not putting forward an opinion, arguing that there are too many unknowns to make an accurate forecast.  The most pessimistic commentators see prices falling continually through 2010, 2011 and even into 2012, but many others think that the economy as a whole will start to come out of recession during 2010 and therefore don’t agree with such a gloomy outlook.

People who need to move house are in an awkward situation.  How much is their property worth?  Is that figure going down or is it stable?  What’s the likelihood of finding a buyer, and will that buyer be able see the deal through to its conclusion?

There are so many unknowns in property sales even when the market is buoyant.  It is good to know that there is a way of selling your property regardless of the state of the market, and that is through Property Rescue.  They promise to give you a valuation for your home which, if you accept it, will lead to a guaranteed sale.

For information on how to sell your home fast, contact Property Rescue.

House prices in England and Wales fell by an average of 13.8% last year.  There are conflicting opinions on how the property market will fare as the recession deepens, although it is certain that substantial gains are out of the question.  Anyone embarking on the property ladder for the first time or trying to sell their home is in for a bumpy ride.

The 2008 price fall was the biggest drop the market has seen, even outdoing the famous 1932 depression.  Some parts of the country fared better than others with Wales only seeing an 8.6% drop, while the South West saw almost double that as a massive 15.6% was cut off the value of their homes.

The practice of taking out equity in the home, or re-mortgaging, has almost come to a halt as lenders become more cautious and homeowners are unsure as to what their property will be worth in a year or two’s time.  But is this caution justified?

On the one hand the signs that property values will fall further seem strong.  They include factors such as:

-    a worsening recession
-    an increasing number of company bankruptcies and personal insolvencies
-    a rise in the jobless figures
-    a lack of availability in the mortgage market
-    a belief that property was over-priced and still has some way to fall before it     achieves realistic values

The other side of the argument points to more positive signals, including:

-    a steady rise over the past six months of people wanting to buy
-    a bottoming out of the housing market, prompting people to buy now
-    a strong message from the Government that lending needs to start again
-    low interest rates, making mortgages more affordable

In fact, the situation is so complicated that two of the biggest lenders, Halifax and Nationwide, have declined to predict how the market will perform this year.  Likewise, the Council of Mortgage Lenders is not putting forward an opinion, arguing that there are too many unknowns to make an accurate forecast.  The most pessimistic commentators see prices falling continually through 2010, 2011 and even into 2012, but many others think that the economy as a whole will start to come out of recession during 2010 and therefore don’t agree with such a gloomy outlook.

People who need to move house are in an awkward situation.  How much is their property worth?  Is that figure going down or is it stable?  What’s the likelihood of finding a buyer, and will that buyer be able see the deal through to its conclusion?

There are so many unknowns in property sales even when the market is buoyant.  It is good to know that there is a way of selling your property regardless of the state of the market, and that is through Property Rescue.  They promise to give you a valuation for your home which, if you accept it, will lead to a guaranteed sale.

For information on how to sell your home fast, contact Property Rescue.

It could be that you have just cleared college or university and are looking for your first house – which in many cases would mean having to start out by renting a property before you can organize yourself to buy your own flat. It could also be that you already have your own house, but are moving to a new township on a working assignment – which would then mean having to rent a property for your accommodation, in spite of having your own house wherever you are coming from. Or it could just be that you are planning to venture into business, and therefore have to look for premises to accommodate your business, which in many cases would also mean renting a property. Regardless of the specific circumstances, many people who find themselves looking to rent a property often wonder as to how to get the process right. As it were, renting a property is often a long term commitment, an undertaking that one cannot afford get wrong.

The process of renting a property normally starts with the identification of a suitable property, and this is where many people tend to go wrong. As it were, many people just go out looking for a property, without first being clear on exactly what they want. As in all things, when looking for a property to rent, failing to plan is almost inevitably planning to fail. Planning in this respect means soberly sitting down and identifying your exact needs you needs in terms of a rental property (e.g. location, size, amenities e.t.c.), if possible crystalising these needs into a mental vision, and then going out to find a rental property that best fulfils that vision. At this stage, one needs to hold onto their vision of an ideal rental property, and not let it get easily compromised by sweet talking rental agents.

After identifying a suitable rental property for ones needs, the next step in the process of renting a property involves getting into the lease agreement, that is, the contract governing your rental transaction. Again, this is another place where many people make major mistakes, only to realize them much later when there is not much they can do about them. The key to success at this stage of the property rental process is going through the least contract with a toothcomb, identifying potentially injurious (harmful) clauses – and having them addressed (or opting out of the contract if the person renting the property won’t change them). Things to pay particular attention to include the dates when the rent falls due, what is to happen should you find yourself unable to pay your rent on time (it happens even to the most prudent), who is responsible for the maintenance of the property and so on. The contract’s exit clause is another thing you need to pay close attention to and ensure that it is not injurious to you, as however long (or short) you stay with your landlord; you will certainly have to part ways one day.

The final stage in the property rental process generally involves your moving into the rental property. Many property owners will insist that you pay at least a month’s deposit upfront before you are allowed to move into the property. For business properties, you might also be required to pay a non-refundable payment for business goodwill – a sum whose payment you need to carefully consider, as it is not always justified in all cases. When actually moving into the property, you might consider engaging the services of professional house moving service. If you won’t be the one personally doing the move, you are also advised to do a careful inventory audit before and after the move, to avoid loss of items during transit – a common complaint.

It could be that you have just cleared college or university and are looking for your first house – which in many cases would mean having to start out by renting a property before you can organize yourself to buy your own flat. It could also be that you already have your own house, but are moving to a new township on a working assignment – which would then mean having to rent a property for your accommodation, in spite of having your own house wherever you are coming from. Or it could just be that you are planning to venture into business, and therefore have to look for premises to accommodate your business, which in many cases would also mean renting a property. Regardless of the specific circumstances, many people who find themselves looking to rent a property often wonder as to how to get the process right. As it were, renting a property is often a long term commitment, an undertaking that one cannot afford get wrong.

The process of renting a property normally starts with the identification of a suitable property, and this is where many people tend to go wrong. As it were, many people just go out looking for a property, without first being clear on exactly what they want. As in all things, when looking for a property to rent, failing to plan is almost inevitably planning to fail. Planning in this respect means soberly sitting down and identifying your exact needs you needs in terms of a rental property (e.g. location, size, amenities e.t.c.), if possible crystalising these needs into a mental vision, and then going out to find a rental property that best fulfils that vision. At this stage, one needs to hold onto their vision of an ideal rental property, and not let it get easily compromised by sweet talking rental agents.

After identifying a suitable rental property for ones needs, the next step in the process of renting a property involves getting into the lease agreement, that is, the contract governing your rental transaction. Again, this is another place where many people make major mistakes, only to realize them much later when there is not much they can do about them. The key to success at this stage of the property rental process is going through the least contract with a toothcomb, identifying potentially injurious (harmful) clauses – and having them addressed (or opting out of the contract if the person renting the property won’t change them). Things to pay particular attention to include the dates when the rent falls due, what is to happen should you find yourself unable to pay your rent on time (it happens even to the most prudent), who is responsible for the maintenance of the property and so on. The contract’s exit clause is another thing you need to pay close attention to and ensure that it is not injurious to you, as however long (or short) you stay with your landlord; you will certainly have to part ways one day.

The final stage in the property rental process generally involves your moving into the rental property. Many property owners will insist that you pay at least a month’s deposit upfront before you are allowed to move into the property. For business properties, you might also be required to pay a non-refundable payment for business goodwill – a sum whose payment you need to carefully consider, as it is not always justified in all cases. When actually moving into the property, you might consider engaging the services of professional house moving service. If you won’t be the one personally doing the move, you are also advised to do a careful inventory audit before and after the move, to avoid loss of items during transit – a common complaint.

House prices in England and Wales fell by an average of 13.8% last year.  There are conflicting opinions on how the property market will fare as the recession deepens, although it is certain that substantial gains are out of the question.  Anyone embarking on the property ladder for the first time or trying to sell their home is in for a bumpy ride.

The 2008 price fall was the biggest drop the market has seen, even outdoing the famous 1932 depression.  Some parts of the country fared better than others with Wales only seeing an 8.6% drop, while the South West saw almost double that as a massive 15.6% was cut off the value of their homes.

The practice of taking out equity in the home, or re-mortgaging, has almost come to a halt as lenders become more cautious and homeowners are unsure as to what their property will be worth in a year or two’s time.  But is this caution justified?

On the one hand the signs that property values will fall further seem strong.  They include factors such as:

-    a worsening recession
-    an increasing number of company bankruptcies and personal insolvencies
-    a rise in the jobless figures
-    a lack of availability in the mortgage market
-    a belief that property was over-priced and still has some way to fall before it     achieves realistic values

The other side of the argument points to more positive signals, including:

-    a steady rise over the past six months of people wanting to buy
-    a bottoming out of the housing market, prompting people to buy now
-    a strong message from the Government that lending needs to start again
-    low interest rates, making mortgages more affordable

In fact, the situation is so complicated that two of the biggest lenders, Halifax and Nationwide, have declined to predict how the market will perform this year.  Likewise, the Council of Mortgage Lenders is not putting forward an opinion, arguing that there are too many unknowns to make an accurate forecast.  The most pessimistic commentators see prices falling continually through 2010, 2011 and even into 2012, but many others think that the economy as a whole will start to come out of recession during 2010 and therefore don’t agree with such a gloomy outlook.

People who need to move house are in an awkward situation.  How much is their property worth?  Is that figure going down or is it stable?  What’s the likelihood of finding a buyer, and will that buyer be able see the deal through to its conclusion?

There are so many unknowns in property sales even when the market is buoyant.  It is good to know that there is a way of selling your property regardless of the state of the market, and that is through Property Rescue.  They promise to give you a valuation for your home which, if you accept it, will lead to a guaranteed sale.

For information on how to sell your home fast, contact Property Rescue.