News & Views

Movers

Given everything that’s been going on in the housing market over the last four months, it may be that you’re looking at the various factors at play and thinking that perhaps now is a good time to take the next step on the housing ladder.With the recent announcement of what is effectively a Stamp Duty holiday for thousands of potential movers, interest and mortgage rates the lowest they’ve been in a generation or more, greater certainty over repayments thanks to the availability of mortgage products fixed for up to 5 or 10 years and pent up demand, moving suddenly seems very attractive to those who can make it work.The £15,000 saving on Stamp Duty is available on any purchase completed before March 31st 2021 and that will likely be one of the primary triggers for anyone who might have been wavering over taking the plunge into a move.But there’s a potential downside to the saving on Stamp Duty in that sellers will now be more likely to hold out for a better offer than they might otherwise have accepted before Rishi Sunak’s announcement in early July.Regardless of how much it will now cost to move, it still makes sense to get your house into shape for potential viewings as this could deliver two benefits: making your house more attractive to would-be buyers and potentially increasing the value of any offer you might receive for it.Here are simple and relatively inexpensive things you can do that won’t break the bank but may make your house more attractive to would-be buyers.DecorateIt’s amazing the transformation that can be achieved simply by putting a fresh coat of paint on the walls and primary woodwork.Choose neutral colours – you may be proud of the style you’ve created in your home, but buyers need to be able to see the house as a canvas, with all the potential that brings for them to put their own stamp on the property.If you’ve got tired wallpaper, consider stripping it and painting the walls. Wallpaper goes in and out of fashion, but right now it’s very definitely not on-trend, so if your walls are papered, the finish needs to be excellent.Similarly, give exterior woodwork a fresh lick of paint where needed.Tidy the gardenKerb appeal is important, so if you have a front garden, cut the lawn, get rid of weeds in borders, beds, paths, gravel or paving and cut back anything that is overgrown or untidy.Add plants in pots for a splash of colour (you can take them with you when you go) and hanging baskets of you’ve got the room, and paint or treat jaded fencing.And if your front door is painted, give that a fresh coat, too – preferably in a colour that’s warm and welcoming, rather than bold and brassy (unless your property is imposing enough to carry that off).Ditto the back garden. This is where you need to be able to show the space with all the potential it has so your buyers can see themselves out there once they move in.DeclutterYour personal belongings add a sense of personality to your home, but if your knick-knacks are in danger of making the place feel squashed and squeezed then the impression you’re giving is one of a lack of space.Again, your buyers will be viewing your home with one eye on whether their big four-seater sofa will fit in the lounge. Is there enough shelving space for their books or DVDs? Is there space in the kitchen to prepare food, or is the whole room filled with pots, pans, utensils and gadgets?Try to view your home as if you were considering moving in again. If it looks crowded or cluttered, remove it temporarily – either to the loft or to a friend or family member’s garage, or to a storage company.Let the light inLight is a great aid in selling a home. If it’s warm enough, have the doors and windows open during the viewing (unless you live on a busy street where traffic noise is intrusive).Even during the day, having a standard or table lamp on can add warmth and depth to natural light, so make the most of it.Get it clean and tidy!It sounds obvious but making sure the house is tidy and clean is crucial. If need be, and depending on how committed you are to selling, get a professional cleaning company in to give the property a really good deep clean.Similarly, if you have the budget to do it, it’s worth getting upholstery and carpets professionally cleaned before you start arranging viewings.A clean and tidy house that benefits from spruced-up décor and a welcoming garden will always make it easier for someone else to imaging living in that property.This list is designed to offer you inexpensive and easy ways to make your house more saleable and encourage a higher offer.Of course, there are other ways to leverage extra value – but they come at a price and are more intrusive. Nevertheless, it’s worth bearing in mind that in some cases it’s possible to add up to 30% to the value of your home through a loft conversion, extension, garage conversion or getting planning permission for a desirable feature, such as off-street parking.If you’re interested in exploring your options when it comes to moving, get in touch and talk to our friendly expert team. Oportfolio Limited is an appointed representative of Primis Mortgage Network, a trading name of First Complete Limited which is authorised and regulated by the Financial Conduct AuthorityYour property may be repossessed if you do not keep up repayments on your mortgage.Oportfolio Ltd fees are payable on application. We charge a broker fee for property purchases of £495 and a remortgage/further advance fee of £395. Our product transfer fee is £295.

by Oliver Whitehead  -  30 July 2020

Mortgages

There’s no doubt that lockdown has been a time of great stress and worry for many people as fears over finances, job security and, most important of all, the health of loved ones added up to create the most uncertain of times in recent memory.There is no doubt, too, that the country, like the rest of the world, is headed for recession. The latest aggregated forecast for the UK published by the Treasury this week suggests the economy shrank by around 9% during June and July.It seems a reasonably safe bet, then, that as a whole the country is headed for some economic turbulence and recent announcements by the likes of John Lewis, Boots and British Airways have indicated the volatility of employment.Yet whilst there are plenty of commentators talking about a deep and lasting recession, the Treasury’s aggregated figures – the same document in the link above and an amalgam of nine independent forecasts from respected sources – suggests that next year the UK economy will grow by between 6 and 7 percent, more or less negating the economic impact of coronavirus in 2020.Further, the Bank of England has already publicly stated that the recession will be less acute than first feared. Recent studies by the Economic Research Council suggests that recessions do not impact evenly across society.Broadly speaking, it concludes that those with mortgages and a secure income may find the impact less severe than those in lower paid jobs and therefore less well off.All that said, the fact remains that if you’re lucky enough to be in a secure job in a key sector or industry and are confident that your finances and income are robust, then now could well be the best time in recent memory to make a move.Here’s why: Interest Rates Interest rates are at an all-time low, with the Bank of England base rate currently sitting at 0.1%. Although lenders haven’t passed the benefits of that rate in their entirety to borrowers, it does mean there are some extraordinarily good mortgage products available.That makes for an attractive proposition now, but some analysts, such as Trading Economics, are predicting that the base rate will remain at 0.1% for the remainder of this year and all of next, and even in 2022 is only likely to rise to 0.5%.With many lenders offering 5- and 10-year fixed-rate mortgage products, prospective buyers have the confidence of certainty over repayments for many years to come – giving the economy time to recover some lost ground – as well as knowing the fiscal measures that will protect borrowers are likely to be in place for some time to come.Stamp Duty Holiday The decision by the Chancellor, Rishi Sunak, to raise the threshold at which buyers are liable for Stamp Duty (or Stamp Duty Land Tax, or SDLT) to £500,000 has been a welcome shot in the arm for the housing market.Those buying a property for £500,000 or more will save £15,000 in government taxes – equating to somewhere approaching half the average cost of moving into a property valued at between £600,000 and £750,000.The scheme runs until March 31st 2021, giving buyers an eight-month window of opportunity to add real cash to their moving budget, or reduce the size of their prospective borrowing.It does come with one potential downside, though – knowing buyers have more cash to play with may mean sellers are more likely to hold out for a better offer than might have been the case previously. Pent Up Demand The months of lockdown have created a backlog of demand for properties among people who were ready to move when the crisis hit but who have been unable to progress their search for a property or, if they had agreed a sale or purchase, move the transaction forward.Recent reports suggest that demand for properties in the residential sales sector was 46% higher in May than it had been in March before the country went into lockdown.Lockdown has influenced the housing market in other ways, too, with months of being restricted to our homes fuelling appreciation for properties with outdoor space. Some agents are reporting that a property’s garden is now a greater selling point than its kitchen, which has traditionally been a key room for prospective buyers. Lending competition The lending landscape is a difficult one to call. On the one hand, lenders will be looking even more closely at affordability now than they were prior to the coronavirus crisis. Certainly, applications from those working in the most badly affected sectors, such as hospitality and entertainment, will likely bear more scrutiny than they might have done previously.However, the slump in mortgage applications that has been the inevitable consequence of the property sector being suspended means there is increased competition for business from banks and building societies.With proven affordability and a financial situation that inspires confidence, it may be that you’ll get access to a better range of products from a wider range of lenders.Increased competition may also translate into reduced costs in other areas, such as conveyancing, removals and so on.If you’re in a position to move or you’ve been thinking about your next step on the property ladder, come and talk to our friendly team to discover your options. Oportfolio Limited is an appointed representative of Primis Mortgage Network, a trading name of First Complete Limited which is authorised and regulated by the Financial Conduct AuthorityYour property may be repossessed if you do not keep up repayments on your mortgage.Oportfolio Ltd fees are payable on application. We charge a broker fee for property purchases of £495 and a remortgage/further advance fee of £395. Our product transfer fee is £295.

by Oliver Whitehead  -  23 July 2020

Market Trends

Last Wednesday (July 8th 2020) the Chancellor the Exchequer, Rishi Sunak, announced a sweeping change to the rules around Stamp Duty – or Stamp Duty Land Tax (SDLT) to give it its full title.When the property sector was reopened in May, there were fears that the near-3 month hiatus in buying and selling together with concern over the potential recession that may follow the pandemic would cripple the housing market.Whilst the residential housing sector is only a small contributor to the overall UK economy, it has long been seen as a barometer for economic confidence, which is one reason why the Government acted swiftly this week in raising the threshold for Stamp Duty to homes valued at £500,000 and above.Until Wednesday, the Stamp Duty threshold had been set at £125,000 or, in the case of first-time buyers, £300,000. Under the new rules, the threshold will apply to everyone buying a home that will be their main residence. Buy-to-let and second home buyers will also benefit from concessions on Stamp Duty, although these will differ slightly.There had been speculation that the Chancellor would announce the new measures last week, but delay implementation until his Autumn Statement, which is traditionally given in October each year.That prompted immediate concern within the property sector that the announcement would have the opposite effect than was intended, with potential buyers holding off on any transaction until the new measures came into force.But last week, Mr Sunak confirmed the changes would be implemented with immediate effect and would apply to all residential property transactions completed before the ‘Stamp Duty holiday’ expires in March 2021.So, what does that mean if you’re buying a new home? Stamp Duty Holiday For First-time Buyers If you’re buying your first property, you will pay nothing in SDLT on the first £500,000 of the property’s value. If the property is valued at £500,000 or less, you will pay nothing in Stamp Duty, regardless of how you are financing the purchase.The majority of first-time purchases in the UK are expected to come in under the new threshold, but you will pay 5% SDLT on the next £425,000 of the property’s value above £500,000.Stamp Duty Holiday For Movers If you’re moving for the second time or more, then you will also benefit from exactly the same concessions as first-time buyers.It is among this group where the biggest savings will be seen. Prior to the new measures taking effect, if you were in this category of buyer you would have paid £15,000 in SDLT when purchasing a new home for £500,000.As long as you complete your purchase before March 31 2021, you will now pay nothing in SDLT. Stamp Duty Holiday For Second Homes and Buy-to-Let Buyers of second homes and buy-to-let properties will also benefit from the changes, however will still be subject to the Stamp Duty surcharge which applied to second homes before Wednesday’s announcement.If the property you are buying is worth up to £500,000 you’ll have to pay a 3% surcharge (a maximum of £15,000). On a property costing between £500,000 and £925,000 the surcharge will be 8% (a maximum of £74,000), between £925,000 and £1.5m it’s 13% (a maximum of £195,000) and over £1.5m the surcharge is 15%. Can the Stamp Duty holiday be backdated? Unfortunately, no. The measures announced last Wednesday can’t be applied retrospectively, meaning that even if your transaction completed on Wednesday morning you will still have to pay Stamp Duty at the previous rate.It’s important to remember that completion – and not exchange of contracts – is the key here. If you exchanged contracts before the Chancellor’s announcement, but the sale wasn’t completed at that point (which is usually the case), then you will benefit from the new arrangements. Is there any relaxation of the deadline for paying Stamp Duty? Again, no. The current deadline for paying your SDLT to HMRC is 14 days from the date of completion – this has been the case since March 2019, when the old deadline of one month was scrapped, and this has not changed with the new Stamp Duty holiday measures announced last week.However, it’s common that your SDLT payment will be one of the disbursements that is made by your solicitor or conveyancer at the point of completion, and you should check the conveyancing contract you signed or talk to your conveyancer so you’re clear on the arrangements for settling your SDLT payment liability.All in all, the move to raise the Stamp Duty threshold will be good news for thousands of homeowners over the coming months, especially at a time when interest rates are also at an all-time low.If you’re thinking about moving why not get in touch and see how our friendly team can help you take advantage of the opportunities the market currently has to offer?  Oportfolio Limited is an appointed representative of Primis Mortgage Network, a trading name of First Complete Limited which is authorised and regulated by the Financial Conduct AuthorityYour property may be repossessed if you do not keep up repayments on your mortgage.Oportfolio Ltd fees are payable on application. We charge a broker fee for property purchases of £495 and a remortgage/further advance fee of £395. Our product transfer fee is £295. 

by Oliver Whitehead  -  14 July 2020

Buy to Let

The UK property market has now been open again for six weeks following its enforced two-month suspension during the coronavirus pandemic lockdown and, with the easing of government restrictions on property transactions, the buy-to-let (BTL) market has also begun to recover.The last five years have been tricky for BTL investors with changes in tax rules coinciding with sluggish growth in property prices and, this year, the near-overnight suspension of the property sector.Initially, the response by lenders was understandably designed to mitigate risk as LTVs were cut, the product was removed or, in some cases, a temporary moratorium was placed on new applications.A little over a month after the sector was green-lit to resume trading, there are signs that recovery is underway, with more products entering the market and rates on higher LTVs being reduced.https://www.youtube.com/watch?v=ELNLkrFH30oThe decision by the Bank of England early in the lockdown process to reduce its base rate to an historic low has been passed on, in part at least, to borrowers and although BTL mortgage products are generally priced and structured differently to main home loans, there are some attractive deals to be had for investors keen to begin or expand their property portfolios.Having said that, investors buying a BTL property through a limited company will broadly speaking, pay more for their loan than someone applying on a named-person basis would.So there are some cost-effective buy-to-let products out there for those who are in a position to take advantage of them.The bigger question is whether the market will see further movement to make buy-to-let a more attractive proposition in the future.That’s a tough one to call because there’s still a great deal of uncertainty about the long-term effect of the pandemic on the UK economy. Personal financial security is likely still to be a big concern for individuals who have found their job situation squeezed, while lenders are likely to display greater caution around affordability.Whatever post-lockdown normality might eventually look like, it still feels like it’s a way off yet – but until we reach a point where there is greater visible confidence in the economy (such as the removal of the furlough and job retention schemes, etc.) there’s little likelihood that higher LTVs or further significant rate reductions will make an appearance in the near future.Against this backdrop is the fact that even before the pandemic hit, existing landlords were reluctant to expand their portfolios – indeed, a Paragon Banking Group survey showed that three times more landlords were planning to sell their portfolio than we planning to expand.But property remains an attractive investment proposition for those who are in a position to do so. The key is in finding the right property and then ensuring you secure the mortgage that best serves your needs.With the right strategy, a buy-to-let property can provide you with realistic capital growth and the potential to earn an income from it that will cover its associated costs. So whilst it’s essential that you consider all the advantages and disadvantages of a sector where values are prone to fluctuation, there are very clear potential upsides.One of the biggest issues for property investors in the sector has been the changes in tax rules around stamp duty, mortgage relief and capital gains, and this is a particular area where you will need very specialised advice that’s tailored to your specific circumstances.We would always recommend you engage the services of a professional mortgage adviser to give you the advice and guidance that best suits your needs – and ensuring you also have a trusted independent financial adviser (IFA) is a sensible step in assessing your overall financial situation in the context of any plans you may have to enter into the BTL market or to expand an existing portfolio.At Oportfolio, we can support you through the application process to ensure you’re in the strongest possible position to apply for a BTL mortgage and we can identify products and lenders who will be best suited to your specific circumstances.If you’re considering a buy-to-let property investment, or you want to take your existing property portfolio further, why not get in touch and talk to a member of our friendly team to see how Oportfolio can help you to fulfil your investment ambition?  Oportfolio Limited is an appointed representative of Primis Mortgage Network, a trading name of First Complete Limited which is authorised and regulated by the Financial Conduct AuthorityYour property may be repossessed if you do not keep up repayments on your mortgage.Oportfolio Ltd fees are payable on application. We charge a broker fee for property purchases of £495 and a remortgage/further advance fee of £395. Our product transfer fee is £295. 

by Oliver Whitehead  -  6 July 2020
Disclaimer

Your property may be repossessed if you do not keep up repayments on your mortgage.

Oportfolio Ltd fees are payable on application. We charge a broker fee for property purchases of £495 and a remortgage / further advance of £395.
Our Product Transfer fee is £295.

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