Property Rescue Blog

The UK housing market has once again receded to reach the same levels as it stood in February 2006. It is still to be seen if the recent slump in the sales of UK property is just another cycle of recession that goes naturally with any economy or it is a fall that will even dwarf the crash of 1990. According to the recent figures released by the Land Registry, this is a consecutive fifteen month decline where the property value has seen a downward trend to shed almost 50% of its earlier gains, at its peak.

The Facts

The average price of a UK home is now £161,883 and almost all regions of the UK housing market have seen significant drops. Add to the woes the number of sales of houses and the picture looks even grimmer. The HM Revenue & Customs revealed that the sales of houses more than £40,000 decreased to just over 59,000, a stark contrast to the last year when 126,000 homes were sold during the same period.

Pessimists

Experts believe that the UK government is doing its part to overcome the future decline by cutting on the interest rates, suspension of stamp duty on houses less than £175,000 in value and releasing a huge bailout package. Despite such efforts, the UK property sales have yet to register a monthly gain. There are even those experts who are predicting a continuous decline until the mid of 2010. Almost 44% of the homeowners surveyed by the Conservatives say that they fear that they will not be able to pay their mortgage in the coming 12 months.

The Mortgage Lending Council has even stopped issuing a future prediction and potential buyers are not listening to the Nationwide and Halifax pundits. What everyone is waiting for is the actual figure that would suggest a rise in the sales of house or an increase in the current prices. There are approximately 5.7 million people who have become house owners since 2002 and if figures are of any real value then almost 90 percent of the home owners would have already gone in negative equity.

Optimists

Even in these challenging times, there are many experts who believe that it is just a matter of time before the UK housing market sees an increase in the number of housing sold. They point out to a very logical fact; the recession of the early 90’s that eventually turned to become one of the most lucrative decade in the housing industry. All is not lost for the home owners, a few of which are glad to pay the reduced variable interest rates. Similarly, there are many house owners who had borrowed their properties at a long term fixed interest rates. They are happy to pay their mortgages and wait for a turnaround to sell the properties at a reasonable price.

Experts believe that the lack of first time buyers and stiff mortgage regulations are the primary factors to blame for the decline in the UK property sales. What does the future holds is anyone’s guess but there are still a large proportion of experts and consumers who are optimistic about an impending turnaround. And this is what really counts….

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 people are concerned regarding the global credit crunch and the corresponding troubles in the property market. Without access to credit, many individuals and businesses are unable to purchase property, and as such property values have dropped from their high values in 2005 and 2006. This has been a hardship on many, but in every crisis there is an opportunity, and this credit crunch is no exception.

The collapse of readily available credit and corresponding drop in property values means that many prime properties are now priced well below their real value. As property values are sure to rise from their current crisis levels within the next decade, now is actually one of the best times to invest in property. Many banks are now in possession of a large amount of valuable property they have received as collateral for failed loans. While it is true that unattended properties which are foreclosed upon tend to be in poor shape, this is generally due to the fact that the bank is unable to tend to the property, and newly foreclosed properties are generally in superb shape.

Many of these foreclosed properties are also on prime locations, and even if the property is of low quality or incomplete construction the land itself may be worth much more than the asking price. While it takes a lot of practice, research and planning, those with money to purchase said properties stand to make a great deal of money in the next few years.

The problem is, of course, acquiring the funds to purchase such properties. Persons with exceptional credit can still get loans, even large ones, as banks are in need to make money on loans and are thus desperate to make loans to persons they are certain will not be risks. Those with large amounts of wealth at their disposal are of course able to simply use their own money to purchase such properties. Many people have been making a lot of investments in this manner, however most persons don't have large sums of money on hand especially in the current economic crisis. Luckily, there are ways for persons of more modest means to invest.

The easiest and most common way for persons to pull together and cash in on this crisis is for them to pool their money to purchase properties. There are many ways to do this, and anyone wishing to do so should consult lawyers and other organizations which specialize in small business contracts. Everyone wishing to pool the funds will, of course, need to be able to take equal parts in the decision making process, as well as the profits and losses that may come about when the property is leased or sold. The rapid availability of inexpensive property due to the credit crunch also makes now an excellent time for persons who have wished to start a small business to do so, although again it may be necessary for them to pool their funds instead of taking out a loan, unless one or two of them have excellent credit histories.

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.

It’s the question on every homeowners’ lips.  Just how far, and how fast, will property values fall and when will it all come to an end?   Let’s begin by taking a look back at the staggering change in the market we’ve seen over the past year or so.

Towards the end of 2007 only a tiny minority of financial commentators were forecasting a slump in the value of property but the New Year brought with it pessimism and – for the first time in many years – predictions that prices would fall.  At that time the fall was described as a mere levelling off, perhaps a 5% reduction; a theme that continued into the Spring.  But as Summer arrived that percentage became higher, with many banks, lenders and experts saying that the average home would drop in value by between 10% and 15%.  Bad enough, but still far from today’s forecasts of a 25% to 30% drop.

Respected property giant, Savills, is sticking with its analysis that property will have slumped by 25% from its peak at the end of 2009.  They point out, however, that in central London falls could be up to 30%.  On a brighter note, they do predict a slow recovery, which – they say – will be strongest in the South East and will begin in 2010. 

Nationwide Building Society confirms these fears, stating that it too expects house prices to continue to fall over the next two years.  The lender has greatly reduced the number of available mortgages as its pre-tax profits drop 18% over the six months to 30 September. 

It would seem, therefore, that there is little chance of imminent recovery and all the indicators point to the fact that house prices have yet to bottom out.  Whilst this remains the case, first time buyers are hesitant, waiting to see if they can get a better deal and negotiating hard with lenders for the few available mortgages.  Those most vulnerable are those who have bought over the past two to five years when prices were high and lending was lax.  Mortgages of many multiples of salary can spell disaster in a falling market as negative equity comes knocking at the door and job security is threatened.

In an uncertain market there is a certain way to avoid your home being repossessed and that is to sell to Property Rescue.  Their experts will give you a no obligation valuation for your home and although this will be below the current market value, it will – if you accept the offer – guarantee a sale.  If you delay, the value of your home is likely to fall further, so the loss you make on the sale needs to be weighed against the consequences of putting off your decision.  Anyone facing the threat of repossession will not have the luxury of time on their side and will need to act quickly. 

Property Rescue talk to their clients in complete confidence.  They recognise the stress that financial hardship engenders and will explain the process of buying your home in a straightforward way.  Remember, there is no obligation to proceed if you are not completely happy with the service they are offering.  Call Property Rescue today to find out more.

The dramatic 1.5% cut to base rates announced by the Bank of England last week has been welcomed by business, industry and homeowners.  Yet despite this fall in interest rates and the money that has been pumped into the banking system by the government, there is still a shortage of mortgages for first time buyers.

The approval rate for new mortgages has slowed substantially over past months.  Around 57% less mortgages are being approved than at this time last year.  The figures hit rock bottom in August when just £2.1 billion was put into new loans – the lowest amount since 2001.

In the main, banks and building societies appear to be passing on last week’s bank rate cut to its borrowers – at least in part.  But mortgages that benefit from falling rates, such as tracker deals, are in short supply, and new borrowers are expected to find a hefty deposit before lenders will consider their mortgage application.  The nervousness and uncertainty that overshadows the housing market makes it difficult to be optimistic.  Many analysts predict that the next two years will produce further falls in property prices with only a slow recovery in market activity.

Estate agents have borne the brunt of many a sarcastic comment during the rich pickings of recent good times, but they are suffering more than most at present.  The RICS (Royal institution of Chartered Surveyors) reports that on average estate agents sold under 11 homes during the quarter August to October this year – the lowest level since the RICS began keeping statistics back in 1978.  Agencies that expanded to meet the demand of a bullish market are now having to lay off staff or close branches to cope with the sudden downturn.

Anyone wanting to sell their home is at the mercy of what has become a global economic crisis.  An all pervading feeling of helplessness has engulfed vendors as they simply wait, hands tied, to see what the future will bring. 

Property Rescue provides a way of selling up and moving on despite current economic uncertainty.  The offer is simple and straightforward with no hidden extras to pay and no obligation to proceed.  Advice is free and confidential, and you can talk to an expert about your circumstances and your property.  If you accept Property Rescue’s offer for your home, the sale can proceed swiftly without the possibility of collapsing at a later date.  You can be assured that your sale will go through, leaving you free to start planning for the future.

For details and a free, no obligation chat, contact Property Rescue today.

With the property boom having come to a grinding halt, there has been a continual decline in inflated prices. From Newcastle to Manchester, and Birmingham to London, it seems no-one is clear from this slump.

Rumours have been circulating for a while now over the prospect of either selling your property to rent it back, or selling to move in to rented accommodation.

With the property market fluctuating, it seems smart to sell when the market is riding a wave, and buy once this boom has crashed. However, this takes serious knowledge of the property market and strong forecasting. Something perhaps better left to the experts.

This is because; you have to take in to account, the cost of moving (transportation / fees, etc) and the monthly rental fee. It is normally the case that a mortgage payment is lower than a rental payment, not to mention the fact that property prices will have to drop a reported 4% to make selling and renting worthwhile.

The gains from selling to rent can be huge, and have proven to save buyers around 30%. How? As the market has begun to fall, house owners have sold their property, moved in to rented accommodation, only to emerge back on the property ladder a few months later at a ‘discounted’ rate of around 30%.

Genius. Well it can be. The market can be futile, and unpredictable. For all the ups and downs we are subject to, property is genuinely a sound investment in the long term. Sit there long enough and you should be seeing a handsome profit. Nonetheless, I think we would all be happier if there were a way to lower our mortgage, move in to a bigger property, or simply increase the figure in the bank.

Selling and renting is building up quite a reputation for itself, and rightly so. There are however, some pitfalls of which you must be aware. Renting normally requires signing a minimum 6-month contract. If the market does suddenly rise, you may be a few months behind watching prices rise whilst you are contracted to rented accommodation. Naturally if you have the means to support both payments, then you could always rent whilst looking for a ‘bargain’ knowing that once one comes along, the deposit is happily waiting for you in your bank account.

Not only this, but we never truly know how long the slump will last, or whether it is actually a slump or just a slow down. As a result of this, it is important to understand the elements before subjecting yourself to them.

Buying and selling property involves a major decision, and for many of us it will be the biggest decision we ever make. If you see moving as an annoyance, and are not particularly optimistic about property prices, then perhaps think of other solutions – if you can find one. But, if you don’t mind the thought of moving twice, and have a view about where the property market will go, then perhaps selling and renting is for you.