Spring is in the air and it’s that time of year when the daffodils seem to be everywhere and we all begin to emerge from our winter hibernation. And, I’m delighted to say, the weather has started to improve too!
What’s happening with house prices in March 2014?
Another month goes by and London’s house prices go from strength-to-strength. The ripple effect of the Capital’s property market has now really kicked in, not just throughout the South-East, but nationwide published data shows that prices increased by 0.7% in January resulting in the biggest price growth since 2007.
The supply of property to the market continues to trail behind demand, but in April changes recommended in the Mortgage Market Review will come into effect. How the MMR will impact the housing market is difficult to say at this stage, as it will depend upon how large its effect will be on the mortgage advice process and the number of people who are able to borrow mortgages.
Changes to Mortgages Coming up in April 2014
However, it’s fair to speculate that if a large enough number of borrowers are unable to access mortgage finance, demand for housing will be eased; and this will in turn diminish the upward pressure on house prices. In an ideal world, this will give both construction and wages a chance to ‘catch up’. Any short-term negative impact in this case will be offset by a long-term positive one.
But what impact will these changes mean to consumers now? Our mortgage advisor, Anthony Cusack explains:
Mortgage rules are changing in April 2014 advises Anthony Cusack – Antony can provide advice to help you navigate the new rules
“The reforms introduced under the MMR aim to deliver a mortgage market that works better for consumers and is sustainable for all participants. Some of the main changes are that:
- customers need to satisfy lenders that they can afford the mortgage – they must provide evidence of income in all cases;
- customers can borrow an interest-only mortgage as long as there is a credible repayment strategy;
- most interactive sales (for example face to face and telephone) must be advised, unless the customer is a mortgage professional, a high net worth mortgage customer or a business borrower; and
- the non-advised sales process will be completely removed under the MMR. However, under certain circumstances, mortgage lenders will still be able to sell products on an execution-only basis.
“These changes will have a significant effect on how advisors operate. Under the new rules, all monthly payments and household expenditure will be considered during the application process and will need validation, including things like travelling costs, childcare and energy bills. Perhaps, even more significantly, they will also test your ability to withstand any future interest rate rises.”
It has never been more important than now to get professional advice when it comes to arranging a mortgage, and if you’d like to find out more about the new MMR changes; call Anthony on 020 8280 9600.
The West London Lettings Market this March
The lettings market remains buoyant and 2014 has started exceptionally well with lots of activity across all our 5 offices.
Silvia Eldawi, our Lettings Director comments: “With more applicants, multiple offers and less stock, we are achieving more asking price offers and in some cases agreeing tenancies over the asking price for the right property. Of course, this does require hard work as tenants are struggling to come to terms with the lack of good quality properties and increased competition.
“As tenants are finding it hard to secure good properties, they are wishing to tie into longer tenancies, to avoid having to go through the pain of finding a property again in the near future. Our advice to tenants, when they see a property they would like to live in is to offer the asking price, to avoid losing out.
“Our advice to landlords is to always sign up with their agent of choice on a sole agency basis as it relieves stress for both themselves and tenants. In our experience, the best tenants are more attracted to properties that are being marketed and professionally managed by one agent.
“As rents rise so do tenants’ expectations and it is therefore vital that landlords are flexible when it comes to presenting their investment.”
Should you be looking to rent out or sell your property, or would simply like to discuss the market in more detail, please do contact your local branch where one of my experienced team can help and advise on how to make the most of this fast changing and very exciting market.
That’s all for now and if I don’t hear from you before, then I look forward to catching up with you next month.