Just like in the US, getting a foothold on the property ladder can be extremely tough for first-time buyers in the UK. But as the old saying goes, where there’s a will, there’s almost always a way, and celebrity real estate investor Rick Otton seems to know how.

UK looks to stimulate house building. Courtesy vividBreeze

Although Brian Berry, chief executive of the FMB feels the UK government sees the economic benefits that can be brought about by boosting the construction sector, he also thinks it needs to do more to realize this potential. Berry is quoted as saying:

“Our members are ready to help Britain build its way back to growth. In the process helping meet the spiraling housing crisis and improving energy efficiency in homes and businesses. But we can’t do this alone. The government must meet construction firms halfway, and find imaginative new ways of increasing activity in the sector, particularly for small, local builders who may not immediately benefit from major infrastructure investment.”

Berry sees one way forward as being reducing VAT on the energy efficiency improvements to just 5%. He points out that doing so would enable homeowners to improve insulation, fit more efficient boilers and high-performance glazing. In addition Berry thinks UK ministers and local authorities should look at ways of bringing more housing online. This may mean releasing additional land for development, or refurbishing derelicts or empty stock. He added that:

“Easing planning red tape and pushing investment through the new Business Bank will help smaller construction companies begin to start providing the 250,000 new homes Britain needs every year just to keep pace with demand.”

Last week the FMB released its latest State of Trade Survey, and the results make mixed reading. The survey found that a lot of firms think they may have to introduce price increases, as the cost of overheads are eating into their profit margins too much. Wages and material costs are all expected to increase during the next six months. Just under a third thought they may have to lay off workers this year but at least unemployment levels are predicted to fall at a slower rate during the next six months. Although workloads are still decreasing, and the rate of contraction has slowed for housing sectors, it hasn’t done so in the non-residential sectors.

While overall data show an increase, there is a regional devide, with a higher increase for property asking prices in London (3.6%), the South East (3%) and the West Midlands 92.6%). At the other end of dropping asking prices are Wales with a 3.5% decrease, East Anglia (2.5%), the North West (1.8) and the Northern region (0.1%). The only Northern regions reporting an increase were Yorkshire and Humberside.

‘Those coming to market this month have taken a pragmatic pricing approach and kept their asking prices pretty much the same as sellers in December. Sensible pricing will help buyer affordability, one of the factors needed to help warm up the market and encourage a recovery from the credit crunch freeze in transaction volumes,’ said Miles Shipside, director and housing market analyst at Rightmove.  ‘The thaw will also be helped by growing confidence that prices are more likely to go up than down. There is an increasing body of evidence suggesting genuine green shoots of recovery after a prolonged period of the housing market bumping along the bottom.’

According to the newly released data, the weekly run rate for new properties listing in January was 11,153, 22% higher than last years value. While overall it is still down 37% compared to figures from before the credit crunch recorded five years ago, this is still the highest level in the beginning of a year since 2008.

‘While the number of sellers financially fit enough to come to market is still well down on pre credit crunch levels, there appears to be an increased willingness among those that can to give it a go. With Rightmove breaking traffic records, the chances of selling are on the up for sellers whose properties match the price, location and finish requirements of the greater numbers who are searching for a property to buy,’ explained Shipside. ‘Agents in many parts of the country report that the market remains patchy depending on where you live and what type of property you are selling. However, they are all consistent in noting that it is the best finished properties that are the most in-demand, especially as buyers do not have the spare cash to improve their new home so are hunting for the finished article.’

Rightmove’s latest data also showed that those who are going to put property on the market throughout 2013 are primarily driven by discretionary factors. 7 in 10 sellers are in this situation and not forced into the sale by factors such as the three Ds of death, debt and divorce.  Moderately greater mortgage lending might be in play for this year to support the increasing transaction volumes. According to the latest mortgage statistics released by the Bank of England, approvals were up by 3% from November 2011 to November 2012, the highest number of approvals recorded in November since 2007.

‘Those on the wrong side of the minimum deposit borderline are still marginalised, but those that have the funds and earning capacity to trade up will find some lenders offering fixed rate deals at their most attractive ever levels. Lenders are also courting buy to let investors as some areas offer a low risk combination of historically cheap purchase prices and attractive rental income. Rightmove research of professional landlords shows that 74% of those surveyed intend to buy and increase their portfolios within the next 12 months,’ Shipside explained further. ‘A further sign of market recovery is when investors look to property to achieve good returns. The majority of professional property investors appear to have spotted that now is the time to increase their investment, and they are obviously confident that prices are not going to get cheaper.’

While Rightmove comes with a bright forecast for property transactions and the real estate field in general for 2013, not everyone shares their enthusiasm. Nick Hopkinson, director of property company, PPR Estates, painting a very different picture.

‘Seller numbers, whilst up on last year, are still around half the numbers needed in a functioning market with an average of only 64 properties per agent in December 2012. Buyers still require huge deposits going into 2013. Typically they still average 20% according to the latest industry data and, of course, a perfect credit score remains essential for any borrowing. Also, potential buyers are not so easily excited about house prices and actual buying prices remain slightly down at best, excluding the London bubble, when you look at the most recent completion statistics,’ he said.

Gallo said”I learned the hard way, and am happy to apply my knowledge of London culture, property and logistics to help alleviate others’ stress. London Relocation’s approach to property placement is key to stress reduction, and elimination of worry.”

Last year the company was awarded the Rising Star in Relocation Award by Relocationmagazine.com for its high level of personalized services.  According to Gallo, his firm offers properties in a wide price range, allowing them to meet the needs of a diverse clientele. In addition, London Relocation Ltd recently launched a new website.

Clients are very complimentary about their services with one quoted as saying “When I got a job in England my major concern was finding a nice place to live. After finding the relocation agency through Google I contacted them to see what they could do for me. That’s a decision I’m more than happy to share with others, as they did an outstanding job for me.”

London Relocation Ltd is a relocation agency specializing in one-day flat-finding services. It also provides clients with additional services such as helps setting up bank accounts, and sorting out utilities.  The company locates and shows clients between eighteen and twenty five apartments or homes for rent, and they can show these in a single day. This service means 100% of clients have found their perfect location and have signed the lease within 1-3 days. It the perfect service for anyone looking to relocate as it helps to take the stress out of moving to London.

© Daniel Ernst – Fotolia.com

In December, 24% more surveyors across the UK predicted transactions would rise rather than fall over the next three months. At the same time prices held steady last month, and this is the first time since June 2010 that the national price balance hasn’t been negative. This year the RICS is forecasting prices will rise by 2%, and the market in certain areas of the country may have already begun to bottom out.

This new-found stability is predicted to continue, as surveyors are no longer taking a negative view of the price outlook over the next three months. This is the first time respondents to the survey haven’t predicted further price drops over the following quarter since the summer of 2010. The number of homes for sale is relatively stable, but demand from potential buyers is increasing. Last month 12% more surveyors reported an increase in new buyer inquiries, and this particular reading has now been in positive territory for four months. It’s no surprise to learn that prices in London increased significantly, while prices in Wales and the North East saw the largest falls. However prices in the West Midlands stabilized in December.

Peter Bolton King, RICS Global Residential Director said “As we start the New Year, confidence in the housing market does appear to be improving-helped in part by the impact of the Funding for Lending Scheme. Indeed, our members are predicting that transaction levels will continue increasing in many parts of the country. That said, more still needs to be done to ensure potential buyers can access the market at every level. Alongside this, there is still a clear need for more homes to be built.”

Image courtesy of James.Stringer via flickr.com

The period of recession has seen house sales at an all time low. Lenders have been cautious with mortgages, home loans and others mainly because of uncertainty of jobs, the buyer’s inability to meet the asking price and the seller’s inability to sell at a lower price. As a result, the year 2010 saw house sales dip by 5%.

According to the figures quoted by the Bank of England, the mortgage debt went down by nearly £ 9.1 billion in 2010 and withdrawal of house equity is also negative since 2008. The combination of these factors has resulted in the slow market.

But after this period of sluggishness, the market is expected to rise again in the coming years. The dip of 3% in the year 2011-12 will be replaced with an increase of 1.5% in the next financial year and by 4% or more in the coming three years. So, if you are planning to buy a house, now is the time. Find out more about the Top Estate Agents in and around London so that you can get the best deals.

Now Rick Otton, a property investment specialist, is to hold a real estate conference for the UK. It will be focused on strategies for home ownership that don’t involve the banks. Mr Otton is quoted as saying “I was a little shocked to see that the current crop of young families in the UK have actually acquired the label of ‘Generation Rent’ by the IPPR. Though most economists have acknowledged that rising rental rates in the UK have been part of a challenging economic environment, the social implications are not so readily acknowledged.”

Dalia Ben-Galim, associate director at IPPR commented on the report saying “Our analysis shows that the lack of houses is dragging young people down. A huge majority of today’s younger generation want to own their home, just as most of their parents have done. But the prospect is slipping even further over the horizon. Insecure renting stops them from putting down roots, but it is bad for society too.”

Although the report is focused on the 18-30 age group, Mr Otton believes it is relevant for anyone in the UK who wishes to buy their own home. He is keen to point out there are other ways of achieving home-ownership available to those who cannot obtain a mortgage through the banks. His Zero-Debt Property Cash Flow Conference2013 is being held from April 19-21. Anyone booking before the end of the year can take advantage of a payment plan that divides the cost of conference attendance into four monthly payments.

Rick Otton has made money by purchasing inexpensive homes and using them to build wealth. He now teaches these strategies to others, having originally unveiled these methods to the UK back in 2008. More details about the program can be found on his website.

First time buyers have every reason to celebrate in Northern Ireland © stockshoppe – Fotolia.com

In comparison, first-time buyers in the rest of the UK accounted for just 38% of the market during the second quarter of this year. First-time buyers in Northern Ireland now have the largest proportion of the market since 2001. The amount of income spent on initial mortgage repayments for first-time buyers has also dropped, and borrowers spent just 19.1% of their income on their mortgage payments during the second quarter, compared to 19.5% in the previous quarter. This is the lowest percentage since these statistics were first recorded in 2005.

The number of loans advanced to first-time buyers dropped slightly compared to the first quarter, but these figures are the same as for the second quarter of 2011 even though the overall value fell by £10 million. During the second quarter 1,100 loans worth around £80 million were advanced to first-time buyers, compared to 1,200 loans worth £100 million that were advanced during the first quarter of this year. The number of loans advanced for home movers was unchanged compared to the previous quarter, with the average advance being just £92,000 which is the lowest since the third quarter of 2005.

Derek Wilson, chair of the CML in Northern Ireland commented on these figures saying “The proportion of first-time buyers continued to rise compared to the rest of the market in Northern Ireland and is likely to be linked to the movement in house prices and affordability. It’s conceivable that the combination of a rapid deterioration in affordability and the subsequent improvement t as house prices fell, has released a pent-up demand from first-time buyers unable to buy when prices were higher.”

In comparison the UK as a whole saw 6% increase in the number of home loans compared to the previous quarter, and numbers rose by 4% when compared to the same quarter in 2011.

© kreatik – Fotolia.com

This idea has already been criticized by Labour who are concerned such housing may not take into account the needs of low income households. However housing minister Grant Shapps thinks the idea is an interesting one, especially as the UK is somewhat unusual in not already having housing funded by institutional investors looking to gain long-term rental income.

The Montague report includes several recommendations designed to speed up the building of privately rented homes. Some of the suggestions include asking councils to review stalled development sites to see whether any of the homes that were originally planned could be rented out rather than sold. Other ideas include making available buildings and public sector land for housing development, and targeting areas where housing demand is high through making land available to developers, provided a certain proportion of rental homes are built.

In addition the Montague report is asking local councils to look at relaxing existing requirements in order to enable developers to build affordable social homes as well as private housing. However this particular suggestion hasn’t found favor with the Labour Party who doesn’t want to see requirements for affordable housing watered down. Homeless charity Shelter also feels the report could have done more to address the needs of those people already living in privately rented homes, and who are paying high rents without being protected against further rises or the risk of eviction.

The British Property Federation is hopeful these recommendations in the Montague report could lead to extra investment into the housing industry from REITs, pension funds and insurance companies. They see this as being the way forward for developing a long-term private rental sector specifically designed to give renters something a little different compared to current rental property.

© eteimaging – Fotolia.com

They compared a range of mortgages from both banks and building societies and found people could be paying more than they need. A typical example was a two-year fixed rate mortgage which is offered at a similar rate from both banks and building societies at 4.22% and 4.15% respectively. At first glance there seems little difference between the two until you take a closer look at the fees. Building societies tend to have much lower arrangement and booking fees, and could save the borrower an average of £700 over the total term of the mortgage deal. It’s a similar situation with five-year fixed mortgages, as even though the banks offer a slightly lower interest rate, their fees to make up the difference. On average consumers could save more than £200 by choosing to borrow from a building society.

However if you’re a first-time buyer then it’s worth choosing a bank that offers products specifically designed for this sector. Savings for a two-year 90% loan to value fixed rate mortgage can be as much as £1,000, while savings on a five-year fixed rate could be more than £3,000 over the term of the deal.

Experts at Money Supermarket are advising people to look at deals offered by smaller lenders as well as the big banks. They point out the savings could add up to thousands of pounds, especially when the setup fees are taken into account. Borrowers should calculate the total amount they’ll pay over the term of the deal, including the fees before deciding on a particular product.