MORTGAGE & CONVEYANCING news
Mortgage update T
CONVEYANCING
Shared ownership an exceptional opportunity for first time buyers
T
hough mortgage approvals for house purchases have risen over the past 11 months to a
total of 31,747, lending is still down 6.2 per cent year on year since June 2010, when total figures stood at 33,846. Home loans for Shared Ownership properties, however, have dramatically increased due to the return of big lenders to the market. Kush Rawal, head of sales and marketing at Thames Valley
Housing, reports, “Record sales have been achieved in the first half of 2011 at three Thames Valley Housing developments, Hurlington Court, The Hamptons and St George’s Grove. “This is in part a reflection of the increased number of mortgage
providers lending on Shared Ownership properties. Some lenders have resurfaced after two years, including Kent Reliance which has brought an additional 95 per cent LTV product to the market. We understand they have significant lending capacity available. “Also, more first time buyers are realising that shared ownership
is probably the most viable way to get onto the property ladder. Instead of a deposit raised on the entire value of the home, shared ownership buyers only raise a deposit on the value of the share they are buying. For example, the amount needed to buy a £250,000 flat with a 25 per cent deposit would be £62,500. A first time buyer on a shared ownership scheme buying the same flat would only need to raise £15,625, which would be a 25 per cent deposit on a quarter share of the flat.”
INVESTORS
Surge in landlords purchasing family properties
R
esearch from buy-to-let specialist Paragon revealS a surge in the proportion of landlords planning to purchase family-focused housing. Paragon’s Trends research shows the types of
property landlords are looking to invest in homes more suited to the needs of families moving into the private rented sector (PRS). 41 per cent (up from 28 per cent in Q2) are
looking to invest in semi-detached houses and 22 per cent (up from 9 per cent in Q2) are looking to buy a detached property. Paragon’s research shows that landlords let to a range of tenant types across their portfolios, with families a popular tenant choice. Nearly half (45 per cent) of landlords have families as tenants, making them the fourth largest tenant type. Over half let to young couples (55 per cent), with 52 per cent letting to professionals and 50 per cent to young singles. Nigel Terrington, Paragon Group Chief Executive, said, “It is
interesting to see more families relying on the PRS, and this is certainly a trend which I expect to stay.”
40 OCTOBER 2011 PROPERTYdrum DEPOSIT LEVELS More buy homes with smaller deposits
he number of mortgages which required less than a 15 per cent
deposit was at its highest level all year according to new figures from haart Financial Services. Almost one in five mortgages processed last month by haart had a loan to value (LTV) ratio above 85 per cent. This compares with just over one in ten at the start of 2011. There were also an increasing number of customers who were able to take advantage of mortgages available with only a five per cent deposit. The flight to medium to long-term fixed rate mortgages
continues with demand for three, four and five-year deals all rising as customers purchasing their homes seek greater financial certainty. However the opposite trend was seen in the buy-to-let market, with tracker mortgages enjoying resurgence with investor landlords, reaching their highest level for the year so far. David Miles, MD of haart Financial Services explains, “Whilst
the general availability of mortgages is certainly improving, we are noticing a much greater availability of LTV mortgages over 85 per cent, which is great news for those people who are struggling to find the funding necessary for their deposit.” “What’s more, we are also seeing more investor landlords taking
advantage of the current low interest rate environment, high tenant demand and availability of highly competitive mortgage products to strategically increase their current portfolios.”
ACCREDITATION
500th law firm secures Conveyancing Quality Scheme status
T
odmans SRE in Rayleigh, Essex has become the
500th law firm in England & Wales to secure the Law Society’s Conveyancing Quality Scheme accreditation. Since CQS launched at
the beginning of the year the Law Society has received 1229 applications from solicitors’ firms seeking to join the scheme, which recognises high standards in residential conveyancing. The Law Society had originally envisaged an end-of-year target
of 600 firms, but CQS looks set to go well beyond that number by end of 2011. Todmans SRE Partner William Todman said, “We’re delighted to be the 500th firm to achieve CQS accreditation. The standard sends out a clear message to the public that they can expect a high quality service from CQS firms. “For the first time, it gives people a way to distinguish between
the many firms providing conveyancing services. It enables them to choose a firm which will give them excellent advice and good value for money in making the important decision to buy or sell a house or flat. We are very pleased to be part of this initiative by the Law Society.”
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