‘Tis the Season to be frugal


Christmas is coming, and there are plenty of ways in which to ensure that it’s just the goose and not your overdraft that gets fat.

When was the last time you reviewed your mortgage? Chances are, you’ve come off your competitive fixed rate deal and gone onto your lender’s less attractive standard variable rate (SVR), which is why now’s the perfect time to reassess your current financial situation and needs.

Use online mortgage calculators to compare your monthly mortgage repayments on your current deal compared with what could they be with a new lender.

Of course, calculating future repayments, based on your down payments to date, can be tricky. But fear not: your local estate agent can refer you to their mortgage adviser to help with the number crunching to let you crack on with all that present buying.

A review of your insurance policies could also save you money. Your local estate agent should also be able to refer you to one of their approved, qualified insurance intermediary partners to help assess, for example, your household and buildings insurance policy needs.

At the same time, review your car and health insurance to ensure you’re on the most competitive rates. There is a wide range of online comparison sites to help you consider your options.

A review of your utility bills is essential, given recent utility rate hikes. Are you receiving the most competitive service and price in your area?

Of course, you can tackle utility costs with some common sense approaches. In terms of heating, check your home to ensure that your expensive heat is not escaping through ill-fitting windows and doors, and consider your use of appliances to minimise electrical costs.

Similarly, water bills can easily be minimised by ensuring that every washing cycle you do is full of clothes and not just your favourite top you want for Friday night on the town. Also consider your water usage in the garden and for washing windows and the car.

Meanwhile, there are a number of tax breaks available if you’re a home-based worker, so either contact your accountant to ensure that you are getting them or HM Revenue & Customs to find out exactly what you’re entitled to.

Homeowners who’ve been forced to move out of London for more space and who now commute to work each day should ensure that they are travelling in the most cost effective way. An assessment of their journey and the travel options should balance the costs associated with driving, such as road tax, insurance and fuel costs, with, for example, train travel.

It is also worth considering how you shop for groceries. Is driving five miles to the nearest supermarket giant really that cost effective when you can receive a home delivery for as low as £1.99? And in terms of supermarket choice, the major players are competing furiously on price in the run up to Christmas, so be sure to shop around.

But irrespective of its running costs, as you’re sitting among family and friends enjoying your well-deserved banquet, consider the extent to which your current home really meets your needs, or whether 2013 is the year in which you make your next move, wherever that may be.


The path to compromise


Your wedding day should be one of the most important days of your life, and for most people it still is. But new research by Halifax reveals that 28% of 25 to 34 year old Brits believe that buying a house with someone is a bigger commitment than getting married.

The lender’s research, State of the Nation: Mortgages, published this month, also found that around just one in four (28%) 25 to 34 year olds were married when they bought their home with their partner, compared to nearly three in four (73%) 35 to 44 year olds.

Whatever your age, the house buying process is good practice for your forthcoming marriage.
For a start, you need to agree on the location in which you want to buy, the type of property you both imagine yourselves living in together and, at some stage, your preferred décor. But most importantly, you need to agree on your preferred price range based on your realistic affordability.

You also need to have a clear idea about your repayment structure and what each of you will contribute to this as well as general household costs, to minimise any future disagreements.

Inevitably, you’ll both need to compromise on some, if not all, of these areas, but at least when you do, you know you’ll be investing in the path that will soon become your future.


Time for action


We’re finally out of a recession, which means it’s time to consider doing all those things you’ve been putting off for fear of redundancy and not being able to meet your monthly mortgage repayments.

The Office for National statistics revealed earlier this month that GDP – the measure of economic health – rose by a higher than expected 1% in the third quarter.

Long-term economic recovery will, of course, take time. Nevertheless, this respite from the UK’s doldrums is just the boost we need to revisit and revise our property plans for the future.

Are you one of countless renters aspiring to own your own home, but lacking the deposit to do so, or perhaps you have a young family and are desperately in need of more space? Or maybe you’ve been mulling over a property portfolio to supplement your pension plan? Whatever your desire, now’s the time to devise an action plan.

If you’re an aspiring first-time buyer, you should consider the areas in which you’d like to live and then monitor the sale prices of property in those areas, so you know exactly how much you need to save.

Consider your affordability and be realistic. Do you really need to stretch yourself to pay for a five-bedroom detached cottage in the country when there are just two of you to consider? Equally, don’t dismiss an opportunity to pay slightly more than you’d like to in the short-term to exploit historically low prices to lock in long-term gains.

And don’t forget to consider your total monthly outgoings, which will include utility bills, council tax and possible travel costs for commuting to work, as well as your mortgage costs.

There are plenty of free online mortgage calculators that  enable you to forecast your potential costs and assess affordability. Your local estate agent will also have a mortgage adviser, who can help you both assess your potential costs and help you devise a plan to save for these based on your current financial situation.

Similarly, young families looking to upsize should identify their preferred locations and, of course, the local schools. A number of online property sites feature school Ofsted reports, which makes it easier for you to rank your preferred areas.

Meanwhile, prospective investors should consider their motivations for investing to determine their long-term plan. For example, is it to boost your retirement savings, which means that you shouldn’t need an income from your investment for some time, or is it to provide accommodation only for your children while at university, which means ownership of no more than three to five years?

The national average asking price has remained relatively flat since the credit crunch in 2007, with prices now at £234,858 compared with £235,176 in 2007, according to Rightmove, but how long will they remain this way?

GDP recovery for at least the next few quarters is required to really boost confidence in the UK housing market, which is plenty of time to perfect your property plan, whatever it may be.


Expect the unexpected


Totnes hit the national press headlines earlier this month for succeeding in forcing Costa Coffee to axe plans to open in the Devonshire resort, despite the coffee shop giant having already won planning permission to do so.

Totnes, which has a staggering 41 independent coffee shops and outlets, is fierce in its fight against national brands opening up in the town.

This unique selling point will no doubt attract a whole host of prospective buyers, who have tired of the national brand dominance in their current home town.

But other than national press coverage, how can you learn about local areas’ excellence
for yourself?

Estate agency websites are a great place to start. A number of agents feature a wealth of knowledge about the areas in which they operate on their sites and through their social media pages.

Local tourist board websites will tell you about local facilities and attractions in their local vicinity, which is great if you’ve got children to keep entertained.

Prospective investors will be driven more by local yields, which can be sourced from local lettings agents as well as from property portals.

Researching areas to which to move is one of the most exciting parts of the home buying process, which can be heightened by keeping an open mind about your preferred locations. You may well be surprised by what you find you like.


The pursuit of happiness


David has just relocated to the country after 10 years of London life. Redundancy made him reconsider his options and conclude that it was the perfect time for he and his young family to up sticks and swap city living for picturesque Devon.

Now self-employed, Dave’s typical day finishes at around 3pm, after which he meets his children for a walk along the beach or a bike ride around the local park. Dinner parties with the family’s newly acquired friends are a frequent occurrence. David wishes he’d made the move sooner.
But relocating is not for everyone. Kate relocated to Gloucestershire after 20 happy years in Brighton. She thought that downsizing to a quieter location was more suited to her late thirties lifestyle, and presented her with a greater chance of meeting a suitor with whom to start family life. However, the tranquility is more than she bargained for and she’s now considering relocating back to East Sussex. 

Taking time to consider your next move when in the midst of selling your home could save you a lot of heartache in the long run, so why not do just that while your agent is dealing with your viewings? That’s, of course, if you haven’t already decided on your next dream home.

First, consider your motivations for moving. It is to upsize because of a growing family? Country living may be great for outdoor pursuits, but will there be enough to keep your family entertained during the winter months?

Or are you moving to be closer to relatives? If so, how close do you really need to live? Are you happy for them to know your every move when you’re used to the privacy of communication via phone?

Janet discovered the extent to which she’d overlooked this reality shortly after relocating to be closer to her mother. Her new neighbours knew about the happy news that she was expecting her first child before her husband, who was at work, thanks to the indiscretion of her mother. Said mother and daughter now live some distance apart.

Once you’ve identified some possible areas to which to relocate, try to visit them and walk around to assess their suitability, particularly in terms of infrastructure. Are there local shops or do you have to drive five miles for a pint of milk? Are there sufficient spots for Fred’s daily walks, or will it be a mission to drive to somewhere suitably scenic for the two of you?

Are there good schools for your children, or will they have to commute to reach one?

That all said, ultimately you must consider whether you really want to relocate, or whether you’re simply having a bad day that makes you overlook all the really great attributes of your current neighbourhood. Great local residents, shops and transport links are invaluable, so be honest with yourself about your needs.

Are you really in search of, for example, country living and the tranquility this can bring or, like Kate, do you really hanker for the bright city lights that are already on offer on your own doorstep?


On the rebound


House prices bounced back from their Olympic Games-fuelled low this month, increasing by 3.5% on the month and by 1.5% on the year to £243,168, according to the latest Rightmove house price index.

Property prices increased in all regions of England and Wales this month, according to Rightmove. Property in Greater London has experienced the highest monthly price rise, up 4.8% to £478,071. This was followed by the West Midlands and the South East, where prices increased by 3.9% to £190,124 and £311,438 respectively. Conversely, property in East Anglia has experienced the lowest rise, up just 0.5% to £230,057.

In terms of house type, the average asking price of detached properties has increased the most over the last year, up 2.7% to £346,883. Prices increased the least for flats, up just 0.9% to £194,545 on the year.Meanwhile, the Office for National Statistics (ONS) has reported a 1.8% rise in UK house prices in the 12 months to August, down from a 2% rise in the 12 months to July.

On a regional basis, London prices fared the best, up 6.3%, while those in Northern Ireland plummeted by 12.8%. Excluding London and the South East, UK prices remained unchanged.

ONS data also show that the property prices paid by first-time buyers was on average 2.9% higher than in August 2011. Prices increased by 1.4% for existing owners during the same period.


Ship shape and bristol?


The good news is that you’ve taken the plunge and put your house on the market, the bad news is that it’s not selling, or at least the offers you’ve so far received have not been anywhere near your expectations.

But why ever not? The location is great - it’s in an enviable part of town, near to reputable schools and an impressive stretch of greenbelt land; it’s detached with an ample-sized landscaped garden; and the décor’s to die for. Moreover, you’ve spent weeks cleaning and tidying in preparation for a quick sale.

Or have you? In fact, does the rose-tinted image of your property actually match your home? Or is it the home you always aspired to own when you first moved into the property all those years ago, but never quite achieved, due to your unexpected redundancy followed by the arrival of child number three and that holiday too many on which you spent enough to redecorate your home five times over?

Reality bites, and never more so than when you’re in the excruciating situation of having to consider the true state and value of your home. So, here are a few tips to help you close the gap between reality and aspiration.

First thing’s first: accept that there’s no hiding from the numbers. The price for which you first brought your home is readily available for all to view online, with Zoopla being a quick and easy portal source for your perusal. This means, firstly, that prospective buyers know what properties on your street are currently selling for and, crucially, what you paid all those years ago, so manage your expectations in view of this.

Secondly, review your understanding of clean and tidy. A quick browse of property listing images on any of the property portals shows the variations in owners’ definitions. A dark living room is one thing, but a dark living room scattered with clutter and last night’s dinner plates is quite another.

Equally, as much as you can overlook your tardy bin men, who, let’s face it, collect your rubbish as and when they feel like it, and only if it’s inside the wheelie bin and the bin is facing the right way, this is an absolute deal breaker for prospective buyers. Who wants to live in a neighbourhood with such substandard, basic services?

Thirdly, have those last minute DIY jobs lasted? If not, attend to them as soon as possible, and certainly in time for your next viewing.

Finally, and most importantly, arrange a meeting with your agent to discuss their progress. How are they marketing your home, and where? Has your home been advertised in the local newspaper as well as on the property portals?

How many viewings has your agent conducted? Ask about all viewings to date and for all feedback, even the details you’d rather not hear because only then can you hope to sell your home.

Find out about recent sales your agent has made either on your street or in your local area and explore why these properties have sold while yours hasn’t.

Ask your agent’s advice about any additional changes or updates they think you should make to your home to help it sell.

Any agent worth their salt will provide you with honest, constructive criticism because they’re on your side and striving to achieve the same goal: to sell your home as soon as possible and for the best possible price.


Mortgage Minefield


Everyone’s after a bargain mortgage rate in these hard-pressed times, so what’s at the top of the fees free best buy tables this month?

Everyone’s after a bargain mortgage rate in these hard-pressed times, so what’s at the top of the fees free best buy tables this month?

At the top of Moneysupermarket.com’s fixed rate mortgage best buy table as at October 3rd was Northern Rock’s 3.25% three-year deal available for 60% loan to value (LTV), followed by Barclays’ 3.29% two-year deal at 70% LTV.

The best tracker deals were offered by HSBC and Santander, which were both offering 3.29%, 70% LTV deals. However, HSBC’s deal is for the term of the mortgage, whereas Santander’s offer is only for two years, after which the deal reverts to the lender’s standard variable rate, which was 4.24% at the time of writing.

The Council of Mortgage Lenders (CML) estimates that gross mortgage lending totalled £12.6bn in August, which was only slightly lower (1%) than July’s gross lending figure of £12.7bn.

The CML expects NewBuy lending to help boost lending volumes in the coming months, which is the government scheme offering first-time buyers the opportunity to borrow between 90% and 95% LTV for a new-build property.


Owner optimism


It’s a great month for buyers, with the average price of a property coming on to the market this month is virtually unchanged on a year ago and, better still, around the same as it was five years ago.

According to Rightmove’s house price index for September, the average asking price across England and Wale was £234,858, down 0.6% on August.

This is particularly good news for cash buyers, who are in a position to take advantage of this pricing slowdown and use substantial deposits to buy their new home at a competitive price, though bargains are relatively fewer in the South where demand remains bullish

On a regional basis, East Anglia saw the highest asking price increase this month, up 4.3% to £229,231, with Greater London second, with prices up by 0.3% to £456,237.

Meanwhile, London’s top performing borough was Enfield, where the average asking price is £342,314 this month, up 3.4% on August, followed by Redbridge, where the average asking price is up 1.9% from £286,853 to £292,261 for the same period.

Kingston-upon Thames was the worst performing London borough, with prices down 8.1% from £645,572 to £593,398.

Rightmove’s index follows the publication of price indices from Halifax and Nationwide.
Halifax has reported an average UK property price of £160,256 for August, down 0.34% on July, while Nationwide reported a national average price of £164,729 for August, up 1.3% on July.

There’s good news for sellers, too. Prices may have slowed, but home ownership still wins hands down over renting a property.

Halifax research out this month reveals that a homeowner spends around £130 less than a tenant for a similar property – the largest gap the lender has ever recorded.

So, instead of pondering over ‘lost’ value in their home, prospective sellers should consider the fact that while tenants have been shelling out dead money to pay their landlords’ mortgages, they’ve been investing in their bricks and mortar for which they will reap the benefits.


The art of preparation


What are the key features buyers value the most when buying a new home? Square metres? Number of bedrooms? Garden? Conservatory? Parking? Guess again.

Weekly rubbish collections, solar panels and a satellite TV connection are top of buyers’ chimney pot lists when it’s time to make the crucial decision to buy, according to new research from mortgage lender ING Direct.

Amazingly, regular bin collections are most likely to seal the deal for buyers deliberating about the purchase of a property, according to the research, which polled 1,000 people.

But, as with a number of property features, buyers should be cautious about considering a home with solar panels. This follows a warning from the Royal Institution of Chartered Surveyors earlier this year about properties that have had panels fitted for free, which are typically provided in return for ownership of the roof space based on a lease of 25 years.


Your local estate agent, together with its conveyancing team, can advise you on any potential issues with a property you may be considering buying. 

More straightforward features of a property, such as tidy rooms, can help to seal a deal. ING reveals that buyers would be put off by a home having a messy kid’s bedroom and most of these people  (71%) would use it as a reason to negotiate a lower price for a property. In fact, a messy bedroom can knock a staggering £8,000 (5%) off a property’s asking price.

Some buyers would attempt to slash as much as 30% of the asking price, so sellers beware.
Messy rooms are not the only irritant for prospective buyers – unsavoury smelling bathrooms (65%) are also bugbears, as are dirty kitchens (59%) and traces of pets, such as animal hairs (30%).

Then there are buyers who will always be difficult to please, such as the 16% who would object to clashing colour schemes, the 9% who would be offended by unattractive art work and the 8% who would turn their noses up at net curtains.

In spite of all of these potential hurdles to a sale, determined sellers are unlikely to be dissuaded by discrepancies that can be easily rectified once they become owners of the property in question. Nevertheless, why take the risk of reducing your asking price from the off with what are essentially commonsense preparations that should be part of every seller’s checklist when putting their home on the market.

Your local agent can talk your through the necessary preparation for free, along with a list of all suitable property for your needs.