House prices increased by 7.7 per cent over the last year among newly built properties.  Some property experts believe that Government initiatives to help first-time buyers could be encouraging people to overpay their way into negative equity.

Office for National Statistics (ONS) figures show flat or falling prices across the housing market as a whole but include a surprise surge in new house prices.  Government intervention to help first-time buyers may have had the unintended effect of inflating debts young homebuyers take on while the real beneficiaries are builders.

According to the ONS, the average house price across Britain – taking all types of property into account – increased during the year to February by 0.3 per cent whereas during the same period, the average price of new dwellings increased by 7.7 per cent to £221,247.

The ONS confirmed that the number of properties sold had increased by “about 20 per cent”.  This points toward a significant change in the housing market since spring 2011, when Stamp Duty was suspended on properties purchased for less than £250,000.

That Stamp Duty holiday for first-time buyers saved them £2,500 and sources including the Council of Mortgage Lenders (CML) report that thousands rushed to buy before this tax was reintroduced on April 5.  And in March 2012 the government introduced the NewBuy scheme for new-build properties.

Amid a credit crisis caused by excessive debt, much of it secured to overpriced property, the Government is encouraging laxer lending to people with no history of repaying debt so that they can buy overpriced property.

Resources:

• Office For National Statistics

Lifting council tax exemptions on homes that have been subjected to repossession could be one way in which local governments serve to bolster their income and generate greater savings.

South Derbyshire District Council, for example, is considering the approach along with numerous other ideas as it looks to cut costs.

Other suggestions for greater cost-efficiency include allowing residents the opportunity to pay their council tax in 12 monthly payments as opposed to the usual ten, while also sending bill details electronically rather than by the more expensive method of using the postal service.

By introducing the latter alteration, it is anticipated that the local authority could make savings in the region of £20,000 a year.

In addition to removing council tax exemptions for dwellings involved in mortgage repossessions, it has also been mooted that the same approach should be taken with empty homes and abodes undergoing structural repair.

Kevin Stackhouse, head of corporate services at the council, added, however, that the relief setup is unlikely to alter for empty homes in special circumstances, “such as when a person is moved into care, it is affected by fire or flood or where genuine hardship exists”.

Resources:

• http://www.south-derbys.gov.uk/housing/

Mortgage arrangement fees have increased 25 per cent to an average of £1,502 in just three years, according to Moneyfacts.  The record low Bank Rate of 0.5 per cent has pushed down the interest rates on home loans, but providers have raised their fees by an average of £321.

The data shows that it is increasingly important to calculate the total cost of a home loan before deciding which deal is best for you.

There is a tipping point at which a seemingly lower-cost loan with the lowest interest rate becomes more expensive than a loan with a higher rate of interest but a lower fee.

For example, a first-time buyer requiring a home loan of £120,000 may be faced with two options, a three year fixed rate mortgage charging 3.75 per cent with a £2,249 fee and a similar mortgage at 4.25 per cent with a fee of £999.

Although the first loan has a lower interest rate, because of its high arrangement fee it actually works out more expensive over the term than the 4.25 per cent loan.

Rachel Springall from Moneyfacts said: “Consumers need to check the total cost of any mortgage offer.  This means working out the monthly payments using a mortgage calculator online and multiplying this by the number of months of the deal.  Then add the mortgage fee on top.”

Resources:

• http://moneyfacts.co.uk/

This is a little “off-brand” as far as TheAdvisory goes. After all, we’re all about helping people move home!

However, moving house is one of the biggest events in our lifetime.  Yet along with the excitement and pride at the prospect of owning a new home comes fear, anxiety and trepidation of taking such a huge financial, emotional and logistical step.  We look at the five main reasons people choose not to move.

1. Financial:
Solicitors fees, stamp duty, search fees, conveyancing fees and removal costs, you will also have to travel to and from the area in which you are searching for a new property.  Decorating the property and buying new furniture can add up to thousands of pounds.  All very off-putting.

2. Friends and family:
Some move to an area to ‘get more for your money’, or somewhere quiet by the sea, but what about the loss of friends and family?  Many people dislike the prospect of having to ‘start again’ and make new friends and acquaintances in an unfamiliar place.

3. Schools:
Many are dissuaded from moving by the fact that their children attend the local primary school which is the best within 30 miles.

4. Timing:
People often wait for everything to ‘fall into place’ before making the decision to sell up and move on. For example, you may be waiting for that all important promotion or you may want to wait until your children are of secondary school age before your consider uprooting them.

5. Employment:
You may be unhappy with your current role and wish to find a preferable position of employment before you take the huge financial decision to move house.

So the big question is – Are any of these reasons big enough to prevent you moving? Love to hear your thoughts!

Higher unemployment is likely to lead to a rise in house repossessions and mortgage arrears in 2012, the Council of Mortgage Lenders (CML) has warned.

In its forecast, the CML suggests that repossessions will go up to from 37,000 in 2011 to 45,000 this year.

Property sales and mortgage lending are also likely to fall further, it says.

The CML’s forecast of just 825,000 homes being sold in the UK in 2012 would put sales at their lowest since modern records began in 1978.

The lenders’ organisation said the higher level of repossessions would still be lower than in 2009, and much lower than during the economic recession of the early 1990s.

But the CML’s chief economist Bob Pannell said the prospects for mortgage lending and the housing market were “highly uncertain”.

“The household sector has been under financial pressure for some time, as a result of falling real incomes, and more recently higher unemployment,” Mr Pannell said.

“This is likely to unwind some of the improvement in mortgage arrears we have seen over the past two years and lead to a somewhat higher level of repossessions in 2012.”

Resources:

• http://www.cml.org.uk/cml/home – Council of Mortgage Lenders
• Shelter – Repossession Help
• Repossession advice from DirectGov
• Get help selling your house fast to avoid repossession

Over the past year there has been a major shift in conveyancing work, away from the traditional High Street solicitor and towards larger firms of specialist conveyancers, according to a recent survey of Land Registry data.

“Cases are increasingly being handled by larger firms as consumers vote with their feet for a faster, less expensive service,” claims 1st Property Lawyers.

The group believes that the number of solicitors and conveyancers handing cases fell from 5302 at the start of 2011 to 4558 by the end – a fall of 14 per cent.  A smaller number of firms each now handle larger amounts of business.

Whereas a conveyancing solicitor has to be trained across many different areas of law (such as family law, criminal law and litigation), a licenced conveyancer need only be expert in the conveyancing areas of property law.  This can mean that the licenced conveyancer can offer a cheaper service than the conveyancing solicitor, along with more specialised knowledge and experience.

Resources:

• http://www.conveyancer.org.uk/ – Council For Licensed Conveyancers
• The Law Society Find A Solicitor Service
• http://www.landregistry.gov.uk/ – HM Land Registry Website
• http://www.1stpropertylawyers.co.uk/ – 1st Property Lawyers
• TheAdvisory’s recommended conveyancing solicitors

It’s easy to lose track of people and contacts when you’re moving home, so here’s a handy list to remind you who to tell:

• Driving licence: The DVLA may need to update their records and send you new documents.
• Utilities: water board, the electricity and gas companies, the telephone company and your internet provider.  And tell them which is the last day you will be at your current property so that you are not liable for any later bills.
• Health services: your GP (you may have to move to another one), and any regular hospital or consultant appointments.
• Work and school: your employer, so that your payslips and any other documents are correctly redirected. If you have children of school age you should also inform the school office of your change of address and the date from which it starts.
• Council: your local council, so that your entry on the electoral register is correct.
• DWP:  if you’re on benefits, the DWP needs to know your new address.
• Post redirection: The Royal Mail offer a chargeable service whereby you can arrange for any post addressed to your previous residence to be automatically redirected to your new address.  As it can often take a while for some databases to be updated and can often take more than one phone call or email to certain establishments to get your details changed, mail redirection is a very useful way of ensuring that your post reaches you and does not fall into the wrong hands.
• HMRC: Don’t forget to notify the Tax Man as well. H M Revenue & Custom will need to update the records they hold on you with regard to RAYE and income tax etc.

Resources:

• http://www.iammoving.com/ – Very handy change of address service
• Government guidance on moving home 
• Moving your TV licence
• Royal Mail redirection service

National fixed fees online estate agents, eMoov has revealed that home movers in the North are better than southerners at saving money on estate agent fees.

Many can reduce their charges by up to 90 per cent by selling via an online estate agent.  Customers in Yorkshire and the North West now account for 26 per cent of eMoov’s online home sales, compared to London’s 6 per cent, showing that movers in the Capital put up with more expensive high street estate agents.

House sellers in Sheffield are most likely to use the internet for the process, accounting for over a quarter of all eMoov’s home sales in Yorkshire.  Leeds and Doncaster also lived up to the county’s stereotypical moneywise reputation, both claiming over a fifth of the region’s online home sales through the leading online agency.  The North West was the second highest ranked region, with Manchester claiming 22 per cent, Liverpool 18 per cent and Preston 15 per cent of the region’s online sales.

eMoov founder Russell Quirk states: “People are becoming much more comfortable with the idea of selling their homes online, especially when typical high street fees of £3000 can take a big bite out of equity already squeezed by tricky market conditions.

“The internet is the future of estate agency – just the way it was for the travel industry a decade ago.  People are realising that isn’t necessary to pay inflated estate agency fees just to cover the overheads on high street premises, and they also have a good idea of their property’s value thanks to the internet, which means that they don’t need to rely on old-fashioned valuations.”

Resources:

• http://www.emoov.co.uk/ – eMoov Online Estate Agent
• The UK’s Top 5 Online Estate Agents
• Online Estate Agents – Everything you need to know!

1. Mystery shop to find the best estate agent:
Test the one you’re thinking of instructing to handle the sale of your home by pretending you’re a potential buyer. Watch how they deal with your request. Do they push hard to initiate a viewing of the property?

2. Incentivise your chosen estate agent:
Offer a cash bonus, as well as the commission fee, if your agent sells within the first month (at or above the asking price). Or have a variable rate of commission, declining if the house lingers on the market.

3. Set your asking price to maximise internet hits:
Look at the price cut-offs when you search on the main property websites.  If you market your home just over a price band, you may miss some of your potential audience.

4. Get the brochure pictures right;
Never settle for a dull sales brochure and reject your agent’s ideas until something special appears.  This could be a spectacular sitting room, kitchen or a stunning view.

5. Sort out the admin before you sell:
Planning consents, building permits, insurances and guarantees should be gathered together. If you need a mortgage for your next move, then make sure you have an in-principle offer agreed early on. Also, instuct your conveyancing solicitor early so that they can prepare the contract.

6. Customise your home to prospective buyers:
If you know a family is coming to view your home, put toys around the place and make it as child-friendly as possible.  For a young couple, minimal and modern decoration is the best choice.

7. Keep the neighbours happy:
New rules mean serious altercations with neighbours must be disclosed to prospective homebuyers – at least if it has been put in writing.

8. Move out if the buyer needs you to:
It may mean renting for a while and paying for storage, but it can make the difference between selling and not selling.

9. Maximise newspaper coverage:
Local and national papers drive traffic to websites.  People read ads then jump on the internet to get the brochure, photographs and floor plans.

10. De-clutter:
Buyers need to see clear-cut, well-presented space and each room must have a purpose.  Hide, burn or otherwise destroy all the redundant oddities that you’ve grown attached to.

Resources:

• http://www.rightmove.co.uk/ – UK’s largest property search site
• http://www.zoopla.co.uk/ – Research house prices in your area
• TheAdvisory’s guide to presenting your house for a quick sale

According to the conveyancing analyst Reallymoving.com, the biggest population movements in 2011 were from the South East of England to the South West, with Torquay in the English Riviera at the head of the list.  Truro and Exeter were also in the top five locations.

“Our research shows that during 2011 the South West claimed the highest percentage of movers,” says Rosemary Rogers at Reallymoving.com.  “Cities which retain their residents make a healthy mix: Sheffield, Belfast, Chester and New castle all lead the way for residents staying within their postcodes.  It’s a great reflection on those cities.”

The company collects data from homeowners relating to removals and conveyancing, so it can draw up a more detailed picture of population movements than some other surveys.

In total, the company’s annual Migration Monitor studied just over 60,000 home movers in the UK in 2011.