HSBC extends mortgage service to all UK homeowners

There is good news for the worried homeowners of UK. HSBC bank has extended rate matching mortgage to UK’s homeowners. Those homeowners, whose fixed rate mortgage matures before August 31, will be eligible for loan up to 80%, subject to affordability clause.

The extension of services resulted in four fold increase in sales since 14 April. Bank has cleverly set such terms for the homeowners that number of applications for the matching deal will not exceed its pre set target.

The service will enable the homeowners to match two-year fixed rate at 4.54 per cent for additional 2 years. The homeowners will get loans up to 80% of LTV with maximum limit of £250,000.

Quantum of loan and interest rate will decide the amount of fees required to be paid initially. A fee calculator is available on HSBC web site.

Mortgage brokers will not be involved in the deal. Homeowners will have to visit HSBC local branches to avail the services.

Martijn van der Heijden, head of HSBC says that Rate Matcher has received overwhelming response from UK homeowners. HSBC serviced 37,000 calls in the first four days itself. Sales are continuing at four times the normal value. He emphasises that rise in business is not at the expense of quality.

The UK Government’s plan of 2 million homes by 2016 at risk

The UK Government’s ambitious plan of providing for 2 million homes by 2016 is likely to receive a setback.  According to David Stubbs, senior economist at Royal Institute of Chartered Surveyors (Rics), weak market and excess inventories of unsold homes has compelled building firms to drastically reduce building activities.

The number of new-builds fell by 24 per cent in the last three months as per the figures available with the government. He opined problems in mortgage market and slow down in economy would continue to cause decline in house building. As a result, the UK Government’s pledge of building three million homes by 2020 seems a distant possibility.
 
Annual housing start figure, totalling 156,400 in 2007-08, fell by 10 per cent compared with 2006-07. The figure is 18 per cent less when compared with 2005-06. In fact since 1992-93, number of completions exceeded number of starts for the first time in 2007-08.  The National Housing Federation (NHF) spokesperson stated it would be difficult for the government to achieve its target.

The beaten down property market and the hassled homeowners looking for some respite

The Home Builders Federation (HBF) the industry’s trade body has urged and appealed to the government to support the market. The Prime Minister, Gordon Brown, after apprehensions that property prices were likely to fall by ten percent, announced measures to boost the housing market.
 
A spokesperson for The National Housing Federation (NHF) also recently emphasised the importance of social housing in background of the uncertain market conditions. In the meanwhile, there was some respite for the worried homeowners after HSBC bank extended rate matching mortgage to those homeowners with fixed rate mortgage maturing before August 31. They now will be eligible for loan up to 80 per cent, subject to affordability clause. The extension of services has resulted in four fold increase in sales since 14 April.

Quantum of loan and interest rate will decide the amount of fees required to be paid initially. A fee calculator is available on HSBC web site. Homeowners just need to visit HSBC local branches to avail the services.

Who cares for safety of tenants’ money?

It is distressing to know that many tenants are loosing their deposit money and landlords are not complying with official schemes which provide safeguard to both in case of disputes. Citizens Advice and housing charity commissioner Shelter warns that landlords are not safeguarding their tenants’ deposits. According to Liz Phelps the tenants also do not know how to protect their deposit money. Effective April, 2007, landlords in England and Wales are supposed to join any one of the three official schemes while making tenancy agreements. Landlords are purposely avoiding these schemes since they get tied up for refund under the law. The government claims that schemes have protected a million deposits amounting to £900m, since their in April, 2007.

But the fact is many tenants are losing money due to unawareness about the schemes and the agent’s responsibilities. It is the responsibility of the Government to create awareness.
According to Shelter and Citizens Advice, they continue to receive complaints from tenants every week. There is still no protection to their deposit money.

The tenants can lodge their complaint against the landlord or agent with the country court if he refuses to sign up a scheme. The court is empowered to award a tenant three times the amount of deposit.
Marveen Smith, a property solicitor and legal adviser to The Tenancy Deposit Scheme feels that tenants must gather courage and use the courts to and get their deposits back.

Make Profit by Renting House in UK

Renting your own property to earn money includes other costs such as service charges, tenant deposit schemes, property tax, property management, maintenance charges, furniture and insurance for the house. Every person giving his or her own property for rent profit has to bear all these charges.

A large number of people buy property for convenience. However, this is not the best option to choose. Investors who have been in the property renting business since a long time are largely interested in areas where the numbers stack up instead of buying a property closer to where they reside.

The answer is simple, price of houses in Northern England and Scotland is at present lower than the overall average with profits of up to 7 – 8 %. In these regions of the nation buying property for the first time is still affordable.

The extension of the European Union has added to the demand for renting services. Many people have moved from Central and Eastern Europe to Scotland recently. This news is of great importance for the people who invest in property as this is the best time to buy and rent the properties in these parts and earn a lot of profit.

In these areas, you can buy a single bedroom flat for 45,000 pounds and rent it at 300 pounds per month and get returns as big as up to 8%.  This type of very good capital growth in predicted for at least for the next five years

Landlord’s Energy Saving Allowance (LESA) - UK

Landlords’ Energy saving Allowance (LESA), is a gift to the green landlords. It is a tax break that entitles landlords to claim tax return against the amount spent in purchasing and installing energy saving equipments or items. UK landlords’ representative body, The National Landlords Association (NLA) appealed to the private-residential landlords to take full advantage of this provision.

Insulations help in saving energy. Amount spent on insulations and its installation for loft, floor, cavity wall solid wall and hot water systems will attract tax return up to maximum £1,500 per property. The amount, up to the limit of £1,500, spent on energy saving is deducted from taxable income for computation of tax. If the amount spent is £1,200, saving in tax will be £240 at 20% tax rate and £480 at 40% tax rate.

Effective 1 October 2008, obtaining an Energy Performance Certificate (EPC) for will be mandatory for all rental properties in England and Wales. It will be a useful indicator for the prospective tenants to judge how energy efficient is the property they are looking on to hire on rental.

David Salusbury, Chairman, NLA, expects its members to invest in improving the quality of their properties. He is pleased that Government has offered incentive and urges landlords to take advantage of LESA incentive, or risk losing it in future if they fail to avail the tax break.

How to Make Your Property Safer When Renting ?

While giving your property for rent there are a few things which you should do to keep it safe. If the property which you want to give for rent is in snowy region, you should clean up the accumulated snow on the property before letting it to anyone in order to keep it safe. You should also clean up the side roads and path for easy reach to the home. Also the important reason for cleaning is that if some one gets hurt because of your property then that person can sue you and you would have to pay the charges for treatment or in the worst case scenario you might even lose your property. So it better to be safe than worry.

You should also have a smoke detector fixed on every floor of your house or property to protect it from accidental fire. One more important thing you should keep in mind is that you need to change the batteries every 6 months because you do not want that the fire is in your house and no one is warned about it due to dead batteries. So have check at batteries regularly. Also remember that if some one gets hurt because of the fire in your house and if it is proved that if could have been prevented then you will have to pay all the charges for the damage.

There are also many other things which you should keep in mind before renting a property. The best option is to ask the people you have rented your property in the past for any problems. They would be in a better position to give you some insights about unnoticed problems that can seriously damage your property if neglected for a long time.

How to have a good property letting ?

If nothing at this movement is working for you then property letting is your best option.. Property renting is very important to the UK property market. The British Property Federation has told that Property renting or property letting is the best option to solve the present housing shortage in UK. The research shows that the demand for renting property has increased by 25 % as compared to property purchase for self use. The research further states that the trend is likely to continue.

The important thing you need to remember is that property letting is a business. In business, if you satisfy your customers then you would be able to get more benefits and more profits. So understanding the customer’s needs and wants is extremely important if you are in the property letting business.

You should also remember while letting a property that when a tenant is coming to view the property you should make sure that the property is cleaned up and no personal belongings are there inside. If the client wants a furnished house then you should keep the property in a good condition with proper furniture and keep it organized.

The basic thing that one should keep in mind is the need and expectations of the clients from the property. Normally clients look for safety, convenience of travelling and good surrounding environment etc.

Earn Money by Renting Your Property to any Business

If you have sufficient money to buy property in UK then you can make profit using your own property. Many people use their property for various purposes. They just buy a property at a lower price today and then as the price of the property rises they sell it at a higher price and in turn make a good amount of profit. Some owners give their property on rent and earn profit every month and for a longer period of time. It is the best option to get profits on a continuous basis.

The number of businesses in UK is growing rapidly and hence the need for office space is also increasing. So if you have a property or a commercial building then the businesses or companies are ready to pay a huge amount as rent for a good office space in UK. Hence today the best way to make money if you have a property is to rent it as the prices of the properties are increasing day by day. Also, by renting you ensure that you will get a constant income every month for a long period of time.

When you buy a property for renting, you should remember that it should be in the heart of the city from where one can get all the facilities like transportation etc. If you have a property away from town or you if you buy a property away from town then you can give it on rent to someone who needs a storage place or warehouse for goods etc. Even in this case, you should make sure that the place is connected directly to any highway or express way so that the goods can be transported to and from there easily. Availability of such facilities will get you a higher rent on your property.

Redrow, the UK house builder, forced to cut jobs

Redrow, the UK house builder, has been forced to cut jobs owing to the big slump in the market. They see further worsening of the situation even in the peak spring selling period. Sales of homes have fallen more than what company had predicted. The prices also crashed beyond prediction. Company’s gross margins have been badly affected since beginning of January. The shortfall is being partly offset by cutting number of jobs and introducing other measures to cut the costs.

Redrow is holding squeeze on mortgages as the major reason for deterioration of housing market. It points out that slump in reservations is more than 50% when compared to same period last year.

20% is the normal rate of cancellation of reservations in the market. But the situation is heading for worse. Cancellation rate is on rise since Easter. Reservations and cancellations are fluctuating beyond estimates making it absolutely difficult to predict changes accurately. Redrow is still trying to assess how long the slump will last and how much further the house prices will fall. They intend to take all measures to generate value for its shareholders