Marlborough newsletter Dec 2014

Marlborough News December 2014 Overhaul of Stamp Duty – Are You Better Off? Actually in many cases the answer is yes, despite an almost 2% increase in rates at the £500,001 level. Previously the same rate of stamp duty was payable on the full sale price, but now the Stamp Duty or Land Tax (SDLT) for residential property is charged at different rates depending on the portion of the purchase price that falls within each rate band.

Purchase price of property

Rate of SDLT

Up to £125,000

Zero

Over £125,000 to £250,000

2%

Over £250,000 to £925,000

5%

Over £925,000 to £1.5 million

10%

Over £1.5 million

12%

Example: A buyer exchanges contracts for the purchase of a house for £275,000 on 5 December 2014, with completion expected in February 2015. Under the new rules the SDLT is calculated as follows: 0% on the first £125,000 = £0 2% on the next £125,000 = £2,500 5% on the final £25,000 = £1,250 Total SDLT payable = £3,750

Buildings: Str ategic Stone Study Did you know there is now a database which identifies the most significant building stones in each county and, where possible, the original source (including quarries) of stone for a particular building or settlement to aid conservation?

Flood Re: insurers call for extr a funding to make insur ance scheme sustainable Insurers have written to the Government saying it needs to invest at least another £500m on flood defences if the Flood Re scheme is to be sustainable. The independent Committee on Climate Change (CCC) estimates that a further 250,000 homes will be exposed to ‘significant risk’ from flooding by 2035 unless the funding gap is filled.

Flood Insur ance After last year's wettest winter on record, many of those whose homes were damaged by flood water are struggling to pay their soaring insurance bills according to the Association of British Insurers. Mary Dhonau, OBE and a national flood campaigner, said she had been contacted by hundreds of flood victims concerned about their insurance bills.

Residential Markets: A Snapshot View!

• The next five years could see the gulf between the north and south of England grow wider, as house prices are predicted to rise faster in the south than in the north (Rightmove and Oxford Economics) • House prices have dropped in London for the first time in five years, according to September’s survey by the RICS • Nationally, new buyer demand fell for the third month (and particularly in London) and the supply of houses for sale remains tight – so demand and supply are becoming more balanced (RICS) • Scottish house prices are at record levels, with Q3 prices 5.2% higher than in the same period in 2013

• The total volume of sales was 9.1% higher than a year before, which is the highest volume since 2008Q1.

• Average property prices are now above pre-economic downturn levels.

• Although mortgage approvals (and lending) fell in September, gross mortgage lending reached its highest October total since 2008. This points to a gentle easing in housing market conditions and that lending is happening despite stricter borrowing criteria.

• Barratt has reported slowing but ‘robust’ sales activity after last year’s frenetic pace, which was boosted by one of the biggest housing stimulus of recent years. Barratt’s prices charged and margins continue to rise.

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"Your home is your castle and you want to protect it. Affordable flood insurance is difficult to find.”

The National Flood Forum said it had seen a "huge increase" in the number of insurance related calls with a "big rise in the number of people struggling to get insurance at all". A new scheme called Flood Re will be introduced in 2015 which should ensure flood insurance is widely affordable and available.

It was recently announced by the Treasury that more than 1,400 flood defence projects are to receive funding to protect 300,000 homes, Ministers say the "vital" £2.3bn investment - not made up of new money - will help prevent £30bn of damage. However, the CCC - an independent body that advises the UK government - said that only a quarter of flood defences were being maintained fully.

This means the remainder will degrade and need replacing.

TOO OLD TO BORROW? Home buyers over the age of 40 are increasingly being "frozen out" of mortgages because of new rules under the MMR (Mortgage Market Review), the industry is warning. These rules mean that lenders are now restricting loans to anyone who will still be paying off their mortgage by the time they retire.

"To avoid a situation where regulation brings about the extinction of mortgage terms that stretch into retirement, we need clarity and confirmation about where the boundaries of responsible lending truly lie," said Peter Williams, the executive director of the Intermediary Mortgage Lenders Association (IMLA).

The Lending SeeSaw! Nationwide reported that gross and net mortgage lending were down. Does that mean that lending is down? Not necessarily, as the major high street banks are back lending to householders after years of withdrawing from the market and repairing their balance sheets and lending by mutuals (financial institutions owned by their members, also called building societies) was £33bn, of which £19bn was provided by Nationwide itself. That means that more mortgage products

are available, leading to better offers for buyers as greater competition kicks in.

Graham Beale, Nationwide chief conceded however that: "The market is cooler, there is a general slowing down." "We are moving towards a more balanced situation, there was a lot of commentary about overheating in London and the south-east.

Things are now more cautious."

House Prices House price growth picked up to 12.1% in the year to the end of September, official figures show, despite other surveys suggesting a slowdown, with prices rising fastest in London. The Office for National Statistics house price figures are based on mortgage-financed purchases of homes in the UK. It suggested the average home cost £272,000, with prices rising faster year-on-year than at any time since

2007. On a monthly basis, prices were up 0.5% between August and September, the ONS said. More recent data from the Nationwide and the Halifax, based on their own mortgage data, suggested that house price growth had slowed in the 12 months to the end of October.

Do mortgage companies really want to lend to us?

Guest Contributor – Andrew Tottman My more mature colleagues tell me that in the olden days, building societies required you to save with them for some time before they would even consider a borrowing request.

Then there was the very formal interview with the Branch Manager who would say “Yes” if he liked what you told him or “No, improve your prospects and then come back and see me” if he did not.

For better or worse, the days of easy borrowing are most certainly over and we have seen the rise of lenders using computer models and tick boxes. As brokers with access to the whole of the market, our experience can make a real difference in ensuring we select the right lender for each circumstance. The regulators are now much more involved than ever before to protect you to ensure that borrowing is affordable, and new rules have been introduced that require lenders to ensure that they can demonstrate their lending is responsible. It is this drive for evidence that has created some extraordinary delays for some clients in the mortgage process.

But once I have a lenders decision in principle, the rest should be fairly quick?

Having done the research as to which lender has the most suitable product and based on our experience which is most likely to lend on your personal circumstances, we then ask the lenders’ computer for a decision in principle. This is the easy bit.

The full application is where problems can start to occur. As independent mortgage advisers dealing with a great number of lenders at any time, we have learnt how to cope with the level of documentation that some lenders ask for and their apparent lack of consistency. We were also finding that during the credit crunch, and subsequent recession, most lenders shed many of their experienced staff and with them the years of experience which they now find lacking and impossible to quickly train into new employees. This leads to processing backlogs where their mortgage processing department can take a week before someone looks at a supporting document.

This is however starting to come down from the weeks some lenders took.

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How can we as borrowers help to speed up the application process? We need to remember that nowadays lenders need evidence for everything you/we are telling them, so documentation has become much more important. The easiest way to ensure a relatively smooth process is to look out everything that is asked for at outset and respond to any further requests as they arise in a timely manner.

So do lenders want our business? The answer is that if you comfortably fit their criteria they certainly do, but they no longer show any flexibility if you don’t. This means selecting the right lender first time around is so important.

Andrew Tottman Andrew is a director of Chilvester Financial who are a firm of local Chartered Financial Planners. If you would like to speak to Andrew or his team on any matter relating to mortgages or personal finance, do contact Edward or Shona at our Smiths Gore Marlborough office and we will be happy to put you in touch.

Retire in Style Audley Inglewood are delighted to welcome you to view the plans for the next phase of development at their retirement village in Kintbury. Be one of the first to get an exclusive preview and you could find a home to be proud of. The next phase is commencing this winter and includes 24 apartments plus 9 cottages. Completed properties are nearly sold out so don’t miss your opportunity to secure your preferred choice of this final phase, due for completion in 2015. Call Edward or Shona at Smiths Gore on 01672 529050.

Cold Home!

The Icehotel in Swedish Lapland remains famous the world over as the original, and simply the best, hotel made purely from ice and snow. Located in Jukkasjarvi, 200km north of the Arctic Circle, it remains one of the most stylish hotels in the world and certainly the coolest! It is built to a new design each winter, melting back into the River Torne in spring after it has captured the hearts of those who have visited or stayed within its beautifully crafted walls.

New Year Offerings Smiths Gore Marlborough is delighted to let you know of new properties coming to the market in 2015: • 5 luxurious apartments with 2 parking bays, and gardens, in rapturously period Georgian House at The Green in Marlborough • Wonderful home or commercial opportunity – You decide! Two adjoining terraced cottages, completely renovated to provide two two-bedroom homes or one home and income potential/annexe!

We are more than just the largest rur al property managers

• Former Chapel with wonderful woodwork and stonework detail providing scope for conversion to many uses (stp).

Broadband: 20% of UK adults would pay more for a home with good broadband A similar number (18%) say it’s already been a consideration when moving home in the past, and, almost a quarter (23%) would now be likely to negotiate a lower rent or sale price when taking on a property with a poor broadband connection.

coming 26 January 2015

Clients of Smiths Gore can enjoy a brand new website being launched to the market next year. ‘On The Market’, will bring the latest properties to your fingertips and will bring the best of Rightmove, Zoopla and Prime Location into one exciting opportunity. But, there’ll be no adverts, no ‘valuations’ based purely on statistics – in fact, there’ll be nothing on your property’s page except your property, positively presented in the way agreed by you and your agent.

Nowadays, more than 90% of buyers and tenants start their search for a property on the internet. And, of these, more than half use a mobile device such as a phone or tablet. OnTheMarket.com adapts seamlessly to whichever type of device and screen size is being viewed so our visitors always see your property to the best advantage. We have the most uncluttered, user-friendly and modern service of any UK property portal. All screen space is used only to present your property. No distracting adverts for other products, no pop-ups or spam emails, no information over-load – just hundreds of thousands of properties looking their best.

We take this opportunity of wishing you all a very Merry Christmas and Happy New Year!

For more information, contact:

To request a free market appraisal click here.

Edward Hall t 01672 529056 edward.hall @smithsgore.co.uk

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Shona Ford t 01672 529057 shona.ford @smithsgore.co.uk