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House prices record FASTEST annual growth since December 2022 last month, says Nationwide

August 5, 2024August 5, 2024 interestratesinfo

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House prices recorded the fastest pace of annual growth since December 2022, according to Nationwide Building Society.

Britain’s biggest mutual revealed the average house price rose by 0.3 per cent between June and July.

Annually, house prices are up by 2.1 per cent, with the typical home now worth £266,334 – this is the biggest annual rise recorded over the past 18 months.

However, average prices are still around 2.8 per cent below the all-time highs recorded in the summer of 2022.

Property prices reached £273,751 in August 2022, before falling to lows of £257,656 at the start of this year.

Unauthorised mortgage broker among four ordered to pay £4m by High Court

August 5, 2024August 5, 2024 interestratesinfo

The Financial Conduct Authority (FCA) has secured an order of £4m against an unauthorised mortgage broker firm and its associates who the regulator said, “exploited vulnerable consumers”.

The judgment found that the defendants arranged high interest, “unaffordable” bridging loans for people who were about to be evicted from their homes. In some cases, the defendants bought homes from the people facing repossession for less than valued, then rented the properties back to them.

It was found that the firm London Property Investments (LPI) arranged mortgages while NPI Holdings Limited (NPI) bought properties and rented them back to the sellers, both without regulatory authorisation. Daniel Stevens, the director of LPI and NPI, and his father, Tony Stevens, were also found liable.

‘All’ UK households on mortgage rate under 4.5 per cent warned

August 5, 2024August 5, 2024 interestratesinfo

Mortgage payers and business owners have been warned that higherrates are here to STAY despite the interest rate cut from the Bank of England last week. Bank documents show policymakers expect that level to be about 3.5% in three years’ time, with mortgages staying around the 4.5 per cent and five per cent level.

Claire, a maternity support worker from Portsmouth, told the Guardian newspaper her family moved into their house in January 2022 on a 1.99% two-year fixed repayment mortgage, paying £1,042 a month. Since then their mortgage payments have risen by more than £500 a month to £1,596.90.

Landlord tax crackdown has created a rental crisis, says Foxtons

August 5, 2024August 5, 2024 interestratesinfo

Successive tax raids on buy-to-let investors have fuelled Britain’s rental crisis, the boss of Foxtons has said.

Guy Gittins, who heads up the London-focused estate agent, said private landlords have been driven away by a dearth of government incentives, which has reduced the number of available properties to rent.

The UK’s housing crisis has only worsened since the pandemic, he said, prompting the recent surge in rental costs.

According to Mr Gittins, the previous Conservative government “created an environment that was not attractive or profitable” for new landlords to enter the market.

He said: “It needs to be taken very seriously. We need anything that will encourage people back into the private rented sector.

“Ultimately, the UK needs tens of thousands, if not hundreds of thousands, of extra rental [homes] to manage the price growth and make sure it is tempered as much as possible in the medium term.”

Essex landlord banned for three years after HMO court case

August 5, 2024August 5, 2024 interestratesinfo

A rogue landlord who was also a letting agent in Essex has been banned from being a landlord for three years.

Ruhul Mohammed Shamsuddin is now prevented by law from letting houses, engaging in letting agency work or managing properties, and could face both imprisonment and a fine of up to £30,000 if he breaks the banning order, which applies to England only.

He is also prevented from being involved in any company that carries out any of the duties outlined above.

His banning order has been secured via a First Tier Tribunal Property Chamber after Shamsuddin was convicted last year of half a dozen offences in relation to a property at 12, Clifftown Road in Southend-on-Sea (main image) at Colchester Crown Court.

What’s happening to buy-to-let mortgage rates?

August 5, 2024August 5, 2024 interestratesinfo

Average buy-to-let (BTL) mortgage rates have fallen to the lowest levels since September 2022, but remain well above 5%.

While falling rates are good news for landlords, those due to remortgage will face higher repayments, and investors might still think twice before expanding their portfolios.

Here, Which? explains what’s happening to BTL rates and reveals the cheapest deals currently on the market.

First-time buyers spending 40% of pay on mortgages

August 5, 2024August 5, 2024 interestratesinfo

People buying a house for the first time are spending about 37% of their take-home pay on mortgage payments, according to the Nationwide.

The figure is well above the long-term average of 30%, the building society said, making it tougher for new buyers to afford a house.

House price growth picked up in the year to July as wages rose, it added.

Prices increased by 2.1% over the year, the fastest pace since December 2022.

Some people were feeling more confident about getting a mortgage as their pay packets went up, Nationwide chief economist Robert Gardner said.

But relatively high mortgage rates and affordability issues also acted as a brake for prospective buyers.

What can I do about my mortgage now the base rate has been cut?

August 5, 2024August 5, 2024 interestratesinfo

Last week’s Bank of England interest rate cut, the first since 2020, spelled good news for millions of homeowners and would-be buyers – but it has also given them lots to think about.

If you are looking to buy a home, what sort of mortgage do you go for, and is this going to push house prices even higher? And if your existing mortgage deal is about to end, should you grab another one right now, or hold fire in case lenders launch cheaper products?

The cut, from 5.25% to 5%, should translate into lower borrowing costs for homeowners with a base rate tracker mortgage, or whose monthly payments are linked to their lender’s standard variable rate (SVR).

However, almost 7m of the UK’s 8.4m existing residential mortgages are on a fixed rate, so most people won’t see any change. A chunk will, however, need to consider their options over the next few months because their current deal is coming to an end.

Here we round up some of the advice from mortgage brokers.

I got £12,000 free cash using little-known trick to buy £228k first-home at 26

July 29, 2024July 29, 2024 interestratesinfo

PERSONAL assistant Aimee Shipp always wanted to own a home – and skipped University and getting a degree so she could start saving aged 18.

At just 26, the savvy saver bought a £228,000 flat in Harlow, Essex as she worked as a personal assistant.

In her first job, aged 18, she started saving for a house deposit.

She was being paid £32,000 a year, despite having no higher education qualifications.

By 20, this had risen to £35,000 and by 22 she was earning £38,000 a year as a PA.

Aimee said: “I didn’t want to go to university and get saddled with debt, I wanted to get a job and save to buy a home of my own, so that is exactly what I did.”

Last year, she finally decided she had saved enough money to put down a deposit on a home of her own, so started to search for apartments she could afford.

Interest rates cut hopes rise as Bank of England says mortgage approvals steady

July 29, 2024July 29, 2024 interestratesinfo

The Bank of England has reported that the number of mortgage approvals for home buyers remained “broadly stable” in June, with 59,976 mortgages for house purchase approved, compared to 60,134 in May.

The Bank’s Money and Credit report stated: “Net mortgage approvals (that is, approvals net of cancellations) for house purchases, which is an indicator of future borrowing, remained broadly stable at 60,000 in June.”

Since August last year, the base rate has stayed at 5.25 percent.

However, with inflation hitting the two percent target level for the past two months, there are hopes that interest rates can start to be reduced, possibly as early as Thursday, easing the pressure on borrowers.