Council Of Mortgage Lenders Predict a Rise in Respossessions

This year is likely to see a rise in the number of people having their homes repossessed.

According to the Council of Mortgage Lenders (CML), continued economic uncertainty is resulting in more and more people falling behind with their mortgage repayments and the end result will be a increase in the number of those forced out of their properties.

Bernard Clarke, communications manager at the CML, said: "An increase in the number of people falling into arrears is likely to also result in an increase in the number of cases of possession.

“We have forecast an increase in the number of mortgages that will be in arrears of 2.5 per cent or more of the outstanding balance at the end of the year, to be 180,000 as opposed to 166,000 at the end of 2011.”

However, he pointed out the issue is not likely to reach anywhere near the level that it did during the recession of the early 1990s.

Despite this, the National Association of Estate Agents (NAEA) said recently that that this year will see the housing market gradually recover to transaction levels seen prior to the credit crunch.

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FSA Mortgage Restrictions Approved By CML

The Council of Mortgage Lenders (CML) has said that it is pleased with the proposals for reform on mortgage lending put forward by the Financial Services Authority (FSA).The FSA this week outlined new stricter lending rules which it hopes will prevent banks and building societies granting mortgages to people which cannot afford the repayments or allowing them to take reckless measures such as interest-only mortgages without a suitable repayment vehicle.

Initially, the CML said that it had concerns that such restrictions, which will come into forced in 2013, would hinder the market and further reduce people’s ability to acquire.But, after consultation with the FSA, it is satisfied that the changes are a positive move for borrowers and the housing market.

CML director general Paul Smee said: "If lenders are to make their contribution to improving the supply of housing and to the wider agenda for economic growth, then they need a regulatory framework which also supports that objective."

Despite the changes, EH Landlord Services have predicted that the housing market will remain strong for the next decade at least.

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Berkshire Council Plans For Consent for Estate Agent Signs

A Berkshire council's plans could force estate and letting agents to apply for consent before putting up signs, reports the BBC.

Reading borough said it was reacting to a petition from residents living in the university area about the amount of boards "littering" their streets.

The petition called for a complete ban on 'to let' and 'for sale' signs in east Reading, near the university.

Reading letting agent Adeel Rafique said the boards were "crucial advertising" for the student market.

The Redlands Neighbourhood Action Group handed in the petition in October and said that bans on property signs were in place in parts of London.

The petition also protested against boards being on display beyond the legal time limit.

'Walk around'
A council spokesman said as a result of the petition, it was seeking direction from the government about the idea of imposing a consent rule before boards could be put up outside properties.

He added the council was sending out "stern warning" letters to estate and letting agents about the "continuing proliferation" of boards in the university area.

However Mr Rafique, from Parkway Properties, said the planned rule would be bad for business.

"One in three properties here are student lets," he said.

"Students tend to walk around to look for properties, so the boards are crucial advertising for us.

"It would be extreme to have to get consent."

He added the council would "not be able to cope" with the thousands of applications in December, which he said was the time students started looking for accommodation for the following academic year.

RICs Welcomes Government Housing Scheme

RICS welcomes the Government’s Housing Strategy and hopes that the proposals can go some way to boosting the stagnant housing market. Given its central role in driving economic growth, it is right that housing is now at the top of the political agenda.
"Better access to mortgage finance is essential to bring forward the new homes needed to help more achieve their aspiration of home ownership, particularly first-time buyers. The New Build Indemnity Scheme is to be welcomed but care must be taken to ensure it does not distort the market or lenders affordability calculations.

"The focus on new build will not free up chains and may reduce demand for second hand property, putting those who wish to move but have little equity at a disadvantage. Whilst any attempt to stimulate supply and demand will help both consumers and developers, limiting funding to niche areas of the market in this way does not solve the wider need for adequate levels of funding in all parts of the market. Any new scheme must be clear and easy to understand for the consumer.

"Small to medium-sized developers will particularly welcome the Get Britain Building Investment Fund and the recognition of the key role housebuilders will play in driving much-needed economic growth. Further steps to free up public land for developers are encouraging but care must be taken that the land is in the right place with the right infrastructure. Projects must be properly analysed for viability otherwise developers run the risk of creating ‘white elephants’ that do not satisfy demand.

"Whilst a renewed focus bringing investment into the private rented sector is encouraging, an opportunity has been missed to begin delivering real consumer protection and professionalism right across this rapidly growing sector. RICS is keen to work with other industry bodies to develop these proposals.

"This is a good start from the Government but more detail is needed. RICS looks forward to continuing engagement with the Government and the sector to deliver a sustainable housing market that delivers aspirations across all sections of the market, benefiting UK PLC as a whole."

Government’s FirstBuy Scheme has boosted first-time buyer ownership hopes

45% of potential first-time buyers state they are now more likely to get on the housing ladder thanks to the Government’s FirstBuy scheme, according to new research from Rightmove.

The figures will be a boost for the FirstBuy initiative following its full launch in September, although Rightmove’s research does raise some causes for concern. In terms of awareness of the scheme, whilst 59% stated that they had previously heard of the scheme, over a third (37%) of first-time buyers stated that they had not. Of those that were aware of the scheme, 22% said they did not understand whether or not the scheme could help them to purchase for the first time.