Budget 2017 - Good news for the First Time Buyer in Surrey?

Sorry folks that I’m a bit late, unfortunately man-flu set me back a week or so, it’s that time of year!

It is also the time of year that we have a budget, formerly the Autumn statement and this time around it was largely unremarkable except for one headline grabbing titbit.

The abolishment of stamp duty for first time buyerswhere the purchase price is £300,000 or less. When buying above £300,000 to £500,000 the normal rules apply but they still don’t have to pay on the first £300,000. Above £500k all bets are off and you are back to the same rules as the rest of us.

With the average house price in Surrey currently standing at £343,289, stamp duty is now £2,164 for a property at that price for first time buyers, saving around £5,000 on the ‘average’ Surrey home.

Personally I think it is a good idea, anything that helps first time buyers has got to be a good thing. However I have spotted a negative comment, The Guardian’s Andrew Sparrow said:

“True, the Office for Budget Responsibility has exposed his main headline-grabbing measure, the abolition of stamp duty for first-time buyers for homes worth up to £300,000, as a £600m gimmick that will just push up prices. But, even though it would be nice to live in a world where bad policy always amounts to bad politics, sadly we don’t, and it is hard to see Hammond suffering any penalty for his home owner subsidy (apart from when he realises he has not got £600m to spend on something else). The Tory tribe (MPs and newspapers) will never complain about a tax cut, and it is not a measure that will be voted down in the Commons. (For example, we can’t even be sure Labour will vote against it.)”

Reading between the lines the Guardian rarely agree with anything the Tories do, so I’m going to take the comment with a pinch of salt.

Although I take the point that potentially house prices could be pushed up I feel that the amount of first time buyers that this will encourage is likely to have a minimal effect on the market as a whole. What it does do is give a helping hand to those who have made the effort to save up a deposit and it is a saving they can put towards their new home.

Policing this could well be difficult. Presumably the responsibility for checking the land registry records will be down to the conveyancing solicitor? The government notes on the plan do not give any guidance on this.

Another point to note is that for joint purchases, both parties need to be first time buyers.

What should have more of an effect on the housing market is the promise to build 300,000 homes a year with support for the house building industry and investment in infrastructure. Five new “Garden Towns” to be built as part of this initiative. Sounds great, not sure where the money is coming from or where they are going to build stuff but I’m sure the boffins in Whitehall have got a cunning plan! Locally the plan to develop an 1800 home settlement at Dunsfold has been approved so I guess a few of these up and down the country will be part of the plan. I do recall this being in the pipeline for quite a few years though, and as far as I am aware no bricks have been laid yet.

So my conclusion, some headline grabbing policies but only time will tell if they will work and, in the case of the housebuilding, rather a long time.

If you’re a first time buyer looking to buy a property in Surrey or elsewhere and need mortgage advice, please get in touch. Call us on 01252 759233 or email info@thesurreymortgagebroker.co.uk.

A MORTGAGE IS A LOAN SECURED AGAINST YOUR HOME OR PROPERTY. YOUR HOME OR PROPERTY  MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE OR ANY OTHER DEBT SECURED ON IT.

The Happiest Place in Surrey - Why Move to Woking?

The ONS (Office of National Statistics) annual happiness and wellbeing survey has found that Woking is the happiest place in Surrey! In fact it is the eighth happiest place in the UK.

On average Woking residents rated their happiness as 8.0 out of 10, an increase from 7.4 in the previous year’s survey. The survey looked at four keys areas: Life Satisfaction, Worthwhile, Happiness and Anxiety. Across the first three categories Woking residents clocked up scores of 8.1, 8.3 and 8.0 respectively; and anxiety levels are down to 2.8 (compared to 3.0 in the previous year).

If you already live in Woking you probably know why, but for all those people who perhaps travel through Woking station as they commute to London, here’s why people in people in Woking are so happy.

7 Reasons To Move To Woking

1. Paul Weller is from Woking

I know, you may not rate this as the number 1 reason to be happy, or to move to Woking, but for some of us it’s a key selling point.

1. Property – your money goes further than in some Surrey towns

There is a wide range of housing in Woking and, relative to other popular Surrey towns, prices are fairly affordable. The average house price according to Rightmove is £498,281, detached properties average around £820,086, semi-detached £444,391, and flats £282,463.

1. Regeneration of town centre

Work started on the £460 million redevelopment of Woking town centre in September 17, which will see new retail space, a Hilton hotel, flats and a medical centre; alongside two new public plazas.

1. Easy commute to London

As someone who is already halfway though their journey into London when the train stops at Woking, I’m envious of the commute! There are direct trains into Waterloo (approximately 25 minutes), trains also stop at Clapham Junction and there are plenty of stopping services for other destinations.

1. Green spaces and countryside

Woking is surrounded by countryside including the Surrey Hills – an area of outstanding natural beauty – but it also has plenty of green spaces within it’s town borders. If you want water as well as green space, the Basingstoke Canal passes through the town, providing somewhere to walk, cycle or boat along.

1. Great pantos and culture

The New Victoria Theatre attracts West End shows and also has a great panto every year. As well as this theatre, Woking boasts other cultural venues including the Phoenix Cultural Centre, The Lightbox and the Rhoda McGaw Theatre.

1. Village life on the doorstep

If you don’t fancy living in Woking itself, there are plenty of villages a short distance away that give you the best of both worlds. Consider Knaphill, Sheerwater, West Byfleet, Pryford, and Mayford; all are large enough for your basic needs (shops, schools, doctor surgeries etc.) and are just a few miles out of Woking town centre.

You may also like to read my post on Where To Buy In Surrey If You Commute To London.

If you want to move to Woking and need a mortgage that makes you happy, give me a call!

Call 01252 759233 or email info@thesurreymortgagebroker.co.uk.

A MORTGAGE IS A LOAN SECURED AGAINST YOUR HOME OR PROPERTY. YOUR HOME OR PROPERTY  MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE OR ANY OTHER DEBT SECURED ON IT. 

Buying a House and Moving before Christmas

If you’d like to wake up on Christmas morning in a new home, you need to act fast. December will be here before you know it, and you’ll want to be in your new property at least a couple of weeks before the 25th, so you can decorate the Christmas tree and put a wreath on your front door. Aside from the Christmas decorations, you’ll want time to turn your house into a home too.

Buying A House Fast

If you’ve decided your current home isn’t big enough, you fancy upgrading, moving to a new area or you’re buying your first home, you should dedicate some time to deciding what you want and don’t want from your new home. If you’re buying with someone else, compromise might be required. Having a clear search area, property type and budget, can stop you from wasting time looking at properties that aren’t suitable.

Make sure that you’re registered with local estate agents and that they know you want to move fast. If you’re also selling a property to enable your purchase, you’ll need to find a buyer who is equally as keen to get moving.

Get a mortgage offer quickly

Don’t wait until you’ve found the perfect property before booking an appointment with a mortgage broker. They’ll be able to offer your invaluable advice, answer any questions you have about the house buying and mortgage process, and provide you with a mortgage in principle.

A mortgage broker or adviser will look in detail at your finances and circumstances, asking a number of affordability questions, as it’s vital that you’ll be able to keep up with your mortgage payments, month in, month out, or you could end up losing your home.

They will then search the market for you to find the best mortgage deals, saving you valuable time. Many mortgage comparison sites don’t search all available lenders, and therefore won’t necessarily identify all mortgage products that are suitable for your needs. A broker has access to everyone and will spend the time stress testing each option and exploring alternatives. They’ll then go through the best deals with you, explaining how they each work, e.g. some may be fixed deals for 2 years, 3 years, or 5 deals, which are often ideal if you want to know exactly how much you’ll have to pay each month. If this isn’t something that matters to you, you may decide that a tracker mortgage is better.

Once you find a deal you like, your broker can put in an application, and you’ll receive a mortgage in principle letter. This means that you should be able to get a mortgage for a given amount; so can act as proof that you’re a serious buyer when you place an offer on a property.

From offer, to exchange, to completion

Placing an offer on a property is exciting, but until it’s accepted and the property is taken off the market you won’t be able to begin the conveyancing process. The conveyancing process is what happens when a property legally changes hands. Generally it takes around 6 weeks from instructing solicitors to exchange.

Your mortgage adviser will most likely be able to recommend several local solicitors, for a speedy purchase and / or it is best to get them lined up early so you can instruct as soon as your offer is accepted. They will also act on behalf of the mortgage lender (who is essentially buying the house for you, or at least part of it) and will need details of the mortgage offer to proceed.

The mortgage lender will send a surveyor to assess the property you want to buy, to confirm that the property is worth as much as you say it is. If it’s down valued, you might not be able to get the full amount you were hoping for. If this happens, your mortgage broker will explain the different options available to you, one of which will be to apply again this time with a different lender. Having an independent mortgage adviser to help you through this process, can take the pressure off and make it a lot less stressful than trying to do it yourself.

Once your mortgage has been approved, your broker will probably also recommend buildings insurance products – you need to have this in place from the date of exchange – but you do have the option to shop elsewhere for buildings cover if you choose. Your solicitor will arrange a date for exchange of contracts, and a completion date, which is the day you’ll get the keys to your new home. Once you know these dates, you’ll be able to begin packing up your belongings and book your removal company.

Need a mortgage broker?

Moving home can be stressful especially in the run up to Christmas, but if you have the right professionals in your corner, you should have as smooth a move as possible. If you need mortgage advice, or a general chat about your options for buying a property, please get in touch.

A MORTGAGE IS A LOAN SECURED AGAINST YOUR HOME OR PROPERTY. YOUR HOME OR PROPERTY  MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE OR ANY OTHER DEBT SECURED ON IT. 

Interest Rates...I may have been wrong!

I often tell my kids that they should hold their hands up if they are in the wrong, well it appears my recent blog about Bank of England interest rates may have been written in haste! If you must, you can read it here. In fact since publishing the last blog all the talk has been of an imminent base rate rise. Mark Carney even said as much last week.

So what of the outlook? Well the economists are saying a little rise in the interest rates will help in preventing the economy running away with itself, which will help keep a lid on inflation.

The MPC do not meet until November now so we have a bit of time to breathe and a bit of time for more news to counter the rise or add fuel to the talk of a rise. I have just received an email from Barclays saying they are withdrawing some of their headline fixed rate deals this week and they expect the replacement deals to be higher, this to me could be an indication that their boffins see a rise in the offing too.

Still, as the Bank rate is 0.25% right now and there are only two rate announcements left this year I’m going to stick with my original prediction of the year ending at 0.25%. In my corner we have had nine base rate meetings since the historic reduction of August 2016 and in all but three of those the votes were unanimous in keeping rates at the all time low of 0.25%. The last three meetings have seen two of the nine committee members vote for a rise to 0.5%. Will there be enough of a swing before the year is out to push the rate back up? I’m not convinced.

However, if the rate is pushed up it is only going to go to 0.5% and that is still very low, and given the huge uncertainty surrounding the economy at the moment I think the Bank will leave it alone at 0.5% for some time, if indeed they raise the rate at all.

In conclusion I may be wrong about interest rates staying put but please do not panic, I cannot see them going high, we are not in the 1990’s now.

Give me a call if you would like to discuss this further, and how it may affect your mortgage or your options for taking out a new mortgage. Please don’t hold me to any of my predictions though…!

Bank of England Base Rate - Don't believe the hype!

Last week the Bank of England voted to keep the base rate at the all time low of 0.25%; the rate it has been since the post referendum, recession avoiding drop of 2016. The voting was 7-2 in favour of maintaining the rate, this has been pretty much the pattern for the last year yet this time there was a lot of media noise about an imminent rate rise.

While I understand the need to have something to report I wholeheartedly disagree with the predictions of a rate rise in 2017. I have consistently maintained in previous blogs (go look!) that rates are not going to rise significantly given the economic climate.

Will Interest Rates Rise?

There are one or two indicators that suggest the monetary policy committee may lean towards a rise. The first is the level of employment, some good news statistics were released last week stating that employment has never been higher in the UK and those claiming unemployment benefits has never been lower. I remember a few years ago when Mark Carney suggested that rates might go up when unemployment fell below 7% and he quickly had to change tack when unemployment fell below that level. It just was not the right time to raise rates.

The other main indicator of a potential rate rise is inflation; again traditional economic theory suggests to kerb inflation you raise interest rates. I have to say this theory has carried less weight since the credit crunch of 2008, inflation has fluctuated up and down and interest rates have been broadly the same, suggesting to me that the decision makers are taking a more pragmatic view.

So why do I think rates are not going up? Again there are likely to be many factors that the decision makers take into account however as I am not one of those people I like to take a more simplistic outlook on these things.

Firstly as a nation we are pretty highly geared, what I mean by that is that we have enjoyed borrowing money in recent years, the low interest rates have fuelled a lot of borrowing and frankly a significant rise in rates would see a lot of us struggling. Put simply if you are paying more on your mortgage each month you are going to spend less elsewhere and I don’t think the economy can’t take that kind of hit.

Uncertainty fuels doubt in the economy and I think the post Brexit uncertainty has led to a fall in the housing market. I can only speak personally here but it just feels much quieter than it did 18 months ago. If the Bank of England put rates up, even by a little bit, that is going to add fuel to that uncertainty and the housing market may suffer more as a result.

Finally the main reasoning for my argument is wages. In previous blogs I have stated that only when wage inflation starts outstripping actual inflation will the Bank of England decide to raise rates. All you need to do is listen or watch the news to see that wages are most certainly not rising in line with inflation. The 1% pay cap on public sector employees for the last few years is going to take a bit of time to catch up with inflation, even if they get their 3+% this year. The headlines last week were that wages have actually fallen in real terms meaning we all have less money in our pockets. In these circumstances I think it highly unlikely that the Monetary Policy Committee will vote in favour of a rise.

If you’re concerned about interest rates and your mortgage, please don’t hesitate to contact me for an informal chat about your circumstances and to discuss your options.