Property Rescue Blog

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.

Many expatriates are purchasing property overseas instead of on their native soil. Whether the properties are being purchased as an investment or as a home, there are many benefits and deterrents surrounding the subject of purchasing property overseas. Let us look into a few of the pros and cons together:

Price of Property Abroad

Purchasing property overseas can be a big draw for investors because of the fact that most land is cheaper in less developed nations. For instance, many investors are purchasing property overseas in places like Dubai and Thailand, because they can get more value for their dollars in these nations than they can in their own. Many overseas land developments are geared toward drawing tourists; investors should consider this factor when deciding which property to purchase, as tourists have the potential to bring in a lot of revenue.

Red Tape

One of the biggest deterrents to purchasing property overseas in daunting amount of paperwork that needs to be filled out in connection with your purchase. The property taxes, land laws and rental terms are different from country to country. It can be difficult to properly cooperate with a foreign government's property policies, as they are drastically different than our own.

For this reason, many people purchasing property overseas hire consultants to guide them through the process of securing property overseas. In addition, some investors hire locals in their property investment area, in order to oversee any rental agreements and facilitate any property sales.

Research

There is much research to be done before entering into the process of purchasing property overseas. Long before you get to the nuts and bolts of securing a property investment, you need to seek out your area of interest and define your goals as they relate to purchasing property overseas. Many different regions must be researched in order to determine the specific climate, social landscape and growth potential you are aiming for with any given property.

Some people are interested in purchasing property overseas in order to relocate and live in a new place. For these people, social and climate concerns are of the utmost importance. Other people are interested in purchasing property overseas for strictly investment related purposes. These people will need to focus their research on property rates and the growth potential of the community.

The internet is a much called upon source of information for investors all over the world. With the click of a mouse, hundreds of options for purchasing property overseas can be browsed and researched in depth. In addition, many online forums have been created, in which people interested in purchasing property overseas can exchange information and make connections. These forums can be found by entering key words about your interests into popular search engines such as Google or Yahoo.

Cutting Ties

One of the most reported difficulties in purchasing property overeseas for the purpose of relocating, is the seperation from one's family and friends. Many people purchase property overseas in order to retire in style. Others are looking for a change of pace and scenary. Whatever the case may be, seperation anxiety is a very real fact that must be taken into consideration when purchasing property overseas.

The state of the world’s economy is in crisis and its effects are being felt by the lenders and home owners. The average price of a home in the UK has been falling continuously since the autumn of 2007. Although, the lending institutions are trying their best to stop the credit crunch but it seems that all the efforts are in vain; at least for the time being.

The buyers are feeling the sting of the mortgage approval rates that have declined significantly to only 60.7 percent. Those that have been approved are not something to brag about. According to the British Bankers Association, the average price of the mortgage approval was only £117,000 in 2008.

Major Players

The reaction of the banks is in direct relation to the house prices. More lenders are now awaiting financial assistance from the UK government to approve more loans. The government has stepped up its efforts to bail out the UK banking system by providing nearly £500 billion of the public money. Despite such hectic efforts, it remains to be seen if the plan has any significance.

Halifax and Nationwide have already announced, what may be called recovery packages. Halifax has even gone a step further by passing out 0.5 percent of the initial interest rate cuts to the consumer. Still it’s the buyer and sellers who decide the eventual outcome. The house prices are still down mainly due to a very cautious buyer who is waiting to gauge the results of the recent efforts. As a consequence of such a behavior, there are fewer buyers and the lending institutions are reluctant to give the remaining stockpile to every potential buyer.

What Next?

Experts agree that this tit for tat scenario will keep the lenders from giving large loans unless the home prices rebound. Furthermore, the lending has receded due to the lenders own concern over the rising unemployment and low income. They average income of a UK worker has increased only 3.5% in comparison to a 5% increase in the retail price index. What lenders worry is the inability of the borrowers to pay of their debts, if the economy doesn’t stabilize. Whatever the case may be, one thing is for sure that the UK property value will not rebound if both consumers and lenders remain skeptic about the future. Without a strong consumer sentiment, the declining house prices will mean little incentive for the lenders even if there is a drastic cut in interest rates.

The Future

As discussed, the average price of the new borrowings has declined which is 24% lower than the last year. In order to compensate, the banks are demanding a larger deposit to secure a loan. The Council of Mortgage Lenders, which accounts for more than 98% of the residential mortgage, has stopped predicting the house prices due to uncertainties surrounding the housing markets. Everyone is waiting but all agree that the next six months may provide a definite clue regarding the state of UK property prices.

The Nationwide Building Society has released figures showing that house prices continue to fall in 2009, although the rate of decline has slowed.  In January, prices dropped a further 1.3%, whereas December’s fall was 2.5%.  This is the 15th consecutive month of decline in the property market, with the cost of the average home now standing at approximately £150,000.

Low prices and the lowest interest rates on record should add up to a buyers’ market yet there is continued reluctance to make a move amongst buyers at all levels.  The chief factor in this reluctance appears to be uncertainty about the future.  As job cuts, company bankruptcies and redundancies increase, even those in relatively stable employment are likely to adopt a cautious approach to taking on long term financial commitments.

Adding to the pessimism are findings from fiscal studies and financial bodies.  The International Monetary Fund (IMF) says that the world economy is facing a deep recession from which it is unlikely to recover before 2010, and goes further by saying that recovery even at this point is highly uncertain with much dependent upon financial policy decisions by world leaders.  It is hardly surprising, therefore, that even the most financially stable family feels under threat. 

Meanwhile, there is little sign that mortgage lenders are slackening their restrictive policy on loans and, at a commercial level, the banks remain reluctant to lend to each other thus stifling activity within the economy as a whole.  Until confidence returns to the markets it is difficult to see how changes will filter through to homeowners.

Caught in the midst of this are families who must sell their home for reasons such as redundancy, job moves, family commitments, financial problems, ill health, etc.  Those lucky enough to have attractive properties in sought after locations will probably still be able to sell, although maybe not at the price they would wish to achieve.  But what about the properties that are less desirable – what options are available to their owners? 

As the recession worsens, Property Rescue maintains its offer to buy homes regardless of their condition or location.  The valuation they make for your home may not be at today’s market rate but in a falling market to know that your house has a buyer is a very attractive proposition and a welcome discovery for anyone trying to achieve that elusive sale.  Property Rescue will give you a free valuation on your home, which you can then choose to accept or decline.  If you decide to go ahead, the sale will be guaranteed once the necessary paperwork has been signed; no last minute collapse of the sale, no broken chain and no possibility that you will be left high and dry without a buyer.

More information is freely available from Property Rescue.  Call them today for an informal chat in complete confidence.

Happy New Year from everyone at Property Rescue.  We wish you a successful year but remind you that we are here to help should you find yourself in financial difficulties and need to sell your home fast.

As we start 2009 the financial climate is very similar to the one we’ve been experiencing outside…freezing!  Predictions for the New Year are worrying for everyone – savers, borrowers, young and old alike.  No one is unaffected by what’s happening in the UK and world economies, and despite the raft of government measures taken over recent months the forecasts of what’s to come remain pessimistic.

Two of the big lenders have reported that house prices dropped by approximately 16% last year.  This is a massive drop and the biggest fall seen in a calendar year since records began.  In real terms that equates to more than £22,000 wiped off the value of the average UK home. 

A key effect of house price falls is the negative equity trap.  Some leading bankers and financial commentators feel that the property price drop is only about half-way through and could amount to around 25-30% from ‘top to bottom’.  This is a gloomy view that is certainly not shared by everyone, but it is food for thought for those who are already in – or nearing – the situation where their mortgage is more than the value of their home.  The decision of whether to sit it out and wait for prices to eventually recover or to sell up and cut losses is a tricky one, especially in a market where there is no end in sight to the downward price spiral.

Another difficulty for prospective sellers is knowing the true value of their homes.  In the current market an estate agent’s valuation today may not be the same as the house can achieve tomorrow.  Buyers are in a position of strength and are likely to negotiate hard to get a good deal.  After all, they too are nervous about what their new investment is likely to be worth in a year’s time.

None of these factors do much to warm the financial frost being keenly felt by many homeowners.  Sit tight or sell up depends on your individual circumstances and how you believe the market will look in a year or two’s time, but if you are on the brink of selling or you need to sell fast, consider how Property Rescue could help.

In such a difficult market place Property Rescue still give you a guarantee that they will buy your home, subject to your acceptance of their valuation.  It’s a glimmer of warmth in an otherwise cold outlook, so if you need to sell, call Property Rescue for more information.  All calls are in strict confidence and a valuation will be given on your home without obligation.

As we approach Christmas and the New Year it’s a good time to reflect on what has happened in our economy during the past 12 months and where we are likely to go as the recession bites in 2009. 

2008 has been a traumatic year for the world’s financial markets.  One could be forgiven for being rather gloomy about the current situation and no one would argue that there is plenty to be gloomy about!  However, there are one or two chinks of sunshine and perhaps we should – especially at this time of year – try to look at the more positive aspects of recent events.  After all, the banks could have gone bankrupt and they didn’t, housing prices could have crashed beyond all expectations and they haven’t, and now, as we head towards 2009, there is just a glimmer of hope that property is starting to pick up again, albeit very slowly.

Another fact is low interest rates – bad news for savers but good news for mortgage holders because whilst lenders haven’t passed on the full interest rate decrease, the majority of loans cost substantially less to service than they did this time last year.  Oil prices are about a third of their peak and this is reflected in fuel prices on the forecourt.  Food prices have stabilised but with competition strong, the supermarkets have some exceptionally good promotions that are likely to benefit most shoppers.

Nevertheless, thousands of people have already lost their jobs and more will do so over the coming months.  Some pundits say that the total jobless will reach 2.5 million by April next year.  Let’s hope they’re wrong but if those predictions are anywhere near correct there are many who will be struggling with their mortgage repayments, even should bank rates fall further.  

Christmas is a time when we expect to be in our homes with our family and loved ones, feeling secure about the future.  Unfortunately, there are many who will not be able to do that this year, and will be very fearful about their job security as they start back at work in 2009.  Remaining in your home is a top priority for many, no matter what their financial circumstances, but as income reduces it’s an objective that can sometimes seem impossible.

Property Rescue has a scheme whereby people can stay in their own homes even if they can no longer afford their mortgage repayments.  This is called a ‘sell and rent back’ scheme, where you, as a property owner, sell your home to Property Rescue but can stay in it as a tenant.  Rent is agreed in advance and you have the normal protection under the law that any tenant has.  Although you will no longer own your home, you don’t have the disruption of moving house nor the trauma of repossession.

Property Rescue has helped hundreds of families over 2008.  If you are in a situation where you face the possibility of repossession or your debts are threatening to overwhelm you, call Property Rescue for an informal chat.  Their consultants will talk to you without obligation and give you a free valuation for your home.

For the first time this decade the number of people without jobs has risen to more than one million. 

In an economic downturn this announcement was very much on the cards but of greater concern over the long term is the fall in job vacancies coming on to the market.  The Office for National Statistics (ONC) reports that employment amongst people of working age fell by 0.4% in the quarter ended October 2008, a similar fall to that seen in the previous quarter.  This percentage may not seem large, but what is worth noting is that the number of available jobs fell by 134,000 over the same quarter – the biggest fall for 16 years. 

Over one million people are now claiming unemployment benefit, an increase of some 75,000 over the previous month’s figures and up more than a quarter of a million during 2008 as a whole.  Redundancies are also on the increase with 41,000 more people losing their jobs than in the quarter ended July 2008.

At present, the ONS reports that average earnings for those in employment is unchanged.  With bargains on the high street, petrol prices coming down and the promise of massive January sales, those who are still in work can make significant savings by shopping carefully.  However, there is a huge feeling of nervousness amongst the employed, not helped by analysts’ predictions that three million will be unemployed by 2010.

To present a balanced view, not every commentator shares this pessimistic approach and it is only as the recession plays out its next act that we will see more clearly how the global and UK downturn is likely to affect us all.  In the meantime, the people who cannot find jobs are the ones who are suffering, especially in the lead up to Christmas.  Some of those worst affected will be facing a very real possibility of losing their homes as a result of failing to keep up their mortgage repayments.  For these, Property Rescue offers a solution by buying their home and allowing them to stay there as tenants.  This can mean that people in seemingly impossible situations can rebuild their lives without the stress of moving or, worse, becoming homeless.

Property Rescue deals with every client individually and makes sure all aspects of the transaction are explained in full before a decision is made.  There is no obligation to proceed if, after initial discussions, you feel their offer isn’t right for you.  No salesmen will call and you won’t be pestered by phone. 

Call Property Rescue today to find out more about their buy and rent back scheme.  Remember, the advice of their consultants is without charge and in complete confidence.

In a speech given on Tuesday 21 October in Leeds, the governor of the Bank of England, Mervyn King, admitted that the likelihood of recession in the UK was real and that the downturn could be ‘prolonged’.  Hot on his heels came the Prime Minister admitting in Parliament that recession was around the corner.

This could hardly have come as a surprise to anyone who has read the papers, watched the news or observed the downward spiralling of global economies over the past few weeks, yet the markets reacted the morning after Mr King’s speech with a tumble.  One does not doubt the validity of his warning but wonders whether spelling out the impending doom was justified.  After all, anyone unaware of impending recession must have been visiting from a far away planet!  It all begs the question of whether those in the know are talking a bad situation into a worse one.

There is just a glimmer of light, however, peeping through the darkness of the very long tunnel of home ownership.  The Bank of England reduced interest rates by half of one per cent earlier this month and some pundits think that that another cut will be necessary if Mr King’s warnings about controlling inflation are to be heeded.  Lenders have already responded to the initial cut and are likely to feel pressure to cut mortgage interest rates further should there be another cut in Bank rates.

Meanwhile, back in the long dark tunnel, the numbers of people entering negative equity are rising fast.  There is no end in sight to the fall in house prices, leaving some of those who have purchased recently in the worrying situation of knowing that their loan is more than the worth of their home.; all a grim reminder of the last property crash in the early 1990s.  Currently it is estimated that around 60,000 home owners are entering negative equity every month. 

If you are in that situation, you may be content to wait for stabilisation of the property market.  If cyclical trends are to be believed, property is likely to recover some, if not all, of its value over time.  For many, sitting tight could be the best option. 

But not everyone has the luxury of choice.  If you need to sell up because of rising debts or inability to meet your mortgage repayments, give Property Rescue a call and ask about their guaranteed valuation service.  Initial consultation with one of their experts is free and entirely without obligation.  They will not pressure you into proceeding and will not pester you with phone calls should you decide not to go ahead.  In a market where almost nothing is moving, it is still possible to sell your home.  Call Property Rescue for an informal chat and more details.

Figures just released show that house prices fell at a record level during the past year.  From October 2007 prices are down 12.4%, bringing the average house price to around £162,000 and cutting a massive £20,000 off last year’s value.

This is the 11th consecutive month that prices have dropped, with Northern Ireland and East Anglia being particularly hard hit.  The only place that has bucked the trend is the city of Durham, where prices have actually shown a slight increase.

Although home owners may be distressed about the cut in value of their property, in theory the fall should be good news for first time buyers who have previously been unable to get on the housing ladder.  But the downward trend is making such buyers nervous as they wonder how much further prices will fall and, understandably, are showing reluctance to expose themselves to the threat of negative equity.  More importantly, the credit crunch and the crisis in the banking system means that mortgages are hard to get; a factor that looks unlikely to be resolved in the short term.

Commentators are pessimistic about the outlook over the next 12 months, many predicting that property will continue its decline in value.  Some see the fall being halted at the end of 2009 and a gradual increase happening over the following two to three years.  At present, the US economy and the world financial situation is so volatile that any forecasts must surely be taken with a pinch of salt.

Is it impossible therefore to sell your house?  The lack of first time buyers, the instability and nervousness of the market and the wider economic issues all combine to put people off moving house.  There are some, however, that have no choice other than to move, perhaps through work relocation, family reasons or personal debt.  Estate agents are advising that people need to be very realistic in their pricing if their house is to attract the few buyers out there.  They add that sensible vendors will make sure surveys don’t throw up any nasty surprises, and advise that properties need to be presented in the best possible way.

If you need to sell quickly for whatever reason, there is an alternative to the open market.  Selling your home through Property Rescue gives a number of advantages, including a fast secure sale, ‘paid for’ solicitors fees on the sale, no requirement for a Home Information Pack, and a guarantee that Property Rescue will make an offer for your home. 

For information about how to sell property in a volatile market, call Property Rescue today.  Their advice is free and entirely without obligation.

A rather surprising side effect of the current economic slowdown is that the numbers of couples getting divorced has dropped by about 3%.  It seems that people who would like to sell the family home and move on to a new life find they can’t sell and therefore can’t divide up their assets.

It’s not known how many couples are affected; regardless of what the economy is doing it’s always difficult to sort out fundamental truths about relationship breakdowns from the mass of statistics.  But however we look at it, the fact is that many people getting married today will not spend the rest of their lives together.  The peak age for divorce remains the late twenties – a time when career and family start to make demands and, perhaps, when people drift apart in order in an attempt to fulfil their goals.

Regardless of the causes or numbers of divorce in this country, every one of the statistics hides a relationship breakdown that is almost always accompanied by pain and unhappiness.  For the unfortunate few who find themselves in a broken relationship yet trapped within the same four walls as their partner, the situation must be intolerable.  Re-establishing boundaries and re-creating a new life are both important parts of getting back on solid ground, emotionally, following a divorce, and it must be almost impossible to do either when your former partner is present on a daily basis.

In a market where homes simply aren’t moving off the estate agents’ books, is there anything that couples can do to move their situation forward?  Property Rescue offers a service whereby they guarantee to make an offer for any property, in any condition, in any location throughout England and Wales.  If the sellers accept that offer, the sale will go ahead quickly without any risk of it failing at a later stage. 

The amount Property Rescue offers will be below the market value, but with house prices continually falling, this is not always a significant factor.  Moving out of the family home, dividing up the assets and moving on are often the most important considerations.  Selling your home fast through Property Rescue offers other money saving incentives such as no estate agent fees, no Home Information Pack preparation and the regular legal costs on the sale are included. 

If you are feeling trapped by the property crisis and an emotionally fraught relationship, give Property Rescue a call.  They will talk to both you and your ex partner – individually if you wish – so that you can get all the information you need to make your decisions.   Give them a call today and talk to one of their advisers in complete confidence.