Dispatches « Property News from Saint Property

Saint Property Dispatch. 22nd September 2010
Wednesday, September 22nd, 2010

Low lending levels

· Gross mortgage lending fell to £11.4bn in August down 14% on July and 6% on August last year.

· The lowest August total since 2000 according to The Council of Mortgage lenders.

· The Bank of England have also revealed a larger than expected fall in the number of mortgages approved, 45,000 in August compared with 47,000 in July.

· There is reduced credit being advanced to the economy as financial institutions are having to begin repaying government supported funding.

· “We face the prospect of a difficult second half of the year. However, the Bank of England is likely to keep interest rates at record lows for longer to support the economy. This will continue to alleviate payment pressures for many borrowers” commented CML chief economist, Bob Pannell.

Property prices reviewed

· The latest Rightmove survey has shown new sellers are dropping their asking price by 1.1% (an average of £2474), with this being the third consecutive monthly fall they suggest that prices have dropped by 3.4% (an average of £8000) in the last three months.

· This reflects the initial optimism that buyers and agents initially have for a property not being met combined with the growing confidence by buyers to negotiate on price.

Edinburgh as a world financial centre

· The annual Global Financial Centres index is out, with Edinburgh at number 31 and Glasgow at 46 in the league of 75 cities around the world

· Though Edinburgh has slipped three places it has performed better than the last survey when it slipped sharply down the index.

· London tops the table followed by New York, Hong Kong and Singapore, these top four control more than 70% of equity trading.

· The assessments are based on people and skills, business environment, property factors, market access and general competitiveness.

Saint Property

· Saint Property helps buyers looking to purchase property in Scotland offering property search services as well as advice on due diligence and negotiation.

· We cover both residential & rural property ensuring a property purchase decision is made with sound advice.

· We offer a pre-property purchase consultancy service for those who have found a property but need a second on opinion. We evaluate all aspects of a property on the purchaser’s behalf and report with an unbiased view of our findings.

· Please forward this to anyone who may be interested in the Scottish property market.

· Contact us for advice on +44 (0)131 478 4533 if you are considering purchasing a Scottish Property.

Saint Property Dispatch. 7th September 2010
Wednesday, September 22nd, 2010

Speculation on House Prices

· Holidays are over and speculation has started on the property market by those in the industry.

· Again there is conflicting data from which opinions are formed.

· Nationwide announced a drop in house prices of 0.9% in August and 0.5% in July, whereas Halifax reports rises of 0.2% in August and 0.7% in July.

· Economists are arguing over future interest rate movements, some suggesting they will stay where they are and others suggesting a rise to 5% over the next twelve months.

· Agents report prices returning to pre 2007 levels, whilst statisticians suggest prices are 10% off peak values.

· As a multiple of earnings average house prices are quoted at 5.2, much higher than the long term average of 3.7.

· With impending public spending cuts and personal finances under pressure from higher taxes and slowing in the rate of increase in average earnings, confidence and ability of potential property purchasers is likely to waver, directly impacting on property prices.

Mortgage availability

· Credit in the form of mortgages remains tight with increased industry regulation, lenders more risk adverse and The Bank of England liquidity scheme nearing an end

· Despite that there are now approximately 7600 mortgage products on the market, a huge increase on the 2500 available at the same time last year.

· 5020 of these are fixed rate products, 949 variable rate products and 1649 are trackers. Over 1500 of these products were introduced in August.

· First time buyers are requiring a deposit of 21% on average and home movers are on average putting down a deposit of 29%.

Residential Rental Market

· The RICS Residential Lettings Survey has shown that the letting market has remained buoyant.

· A shortage of properties through rising tenant demand pushed rents higher for the second consecutive quarter compounded by lack of supply with potential investors having difficulty in securing buy-to-let mortgages

· Demand has been driven by potential property purchasers deciding to rent due to difficulty in securing mortgage finance; confidence in the market and large deposits required to purchase.

Saint Property Dispatch. 17.8.10
Tuesday, August 24th, 2010

Housing market optimism in the second half of the year

· The latest statistics from the Registers of Scotland show that the Scottish housing market is in its fifth month of continuous growth with the total value of sales having increased by 23.2 per cent in Scotland since this time last year.

· Data from the RICS shows surveyors are ‘cautiously optimistic’ with 27 per cent expecting prices to rise in the coming months with expectations for sales also positive.

· There was a significant increase in transactions in July; however the outlook for activity is less hopeful with demand from purchasers falling with continued difficulty in securing mortgages and uncertainty about the economy cited as likely reasons for caution from potential homebuyers.

Harvest 2010

· Despite The Russian Agriculture Ministry insisting wheat exports would remain stable a fortnight ago, they have now withdrawn from the export market to ensure supply in the home market.

· With Ukraine also releasing just half of their normal tonnage there are opportunities for UK farmers with a quality crop to capitalise on the premiums currently available.

· November wheat futures are in the £150-155/t delivered range.

Farm Borrowing

· Scotland’s Chief Statistician reports bank advances to Scottish agriculture has risen by 8.7 per cent on last year to £1,506m reflecting capital investment and seasonal needs along with difficult prices particularly in the dairy sector.

· 88.3 per cent of the borrowing is to owner occupier farmers with 8.8 per cent to tenant farmers the remainder to agricultural contractors and livestock salesmen. This reflects the structure of Scottish agriculture where 74 per cent of the agricultural area is owner occupied.

· 60 per cent of Scottish agricultural liabilities (totalling £2,315m in 2009) is in the form of bank borrowing, with the remaining from hire purchase, leasing, family and other sources.

· The latest figures available show the average farm has external liabilities of £89,900 including bank loans and overdrafts of £52,600.

Agricultural Subsidies

· The Scottish Cabinet Secretary for Rural Affairs has approved rules to tighten access by farmers to European subsidies, with payments to reflect the level of productive and environmental activity.

· The Scottish Government’s will plan on the following: no change made until 2013 on the current basis of allocating SFP; SFP will only go to active farmers and the scoring system for the Rural Priorities Scheme should favour new entrants.

· This stance is as a result of the Brian Pack Inquiry into the future of farming support, the final report due later in the year will form the Scottish Government’s negotiating position on the post 2013 Common Agriculture Policy.