Dominic Toller, Managing Director of PropertyEarth.net, comments on the latest CML gross mortgage lending figures

Although the latest figures from the CML hint at housing market recovery, with homeowner lending up annually for the eleventh consecutive month, monthly data is more erratic and the volume of remortgaging remains down on a year earlier, with any positive trends set to reverse in the second half of 2010 and early 2011.

Evidence suggests that estate agents are already experiencing a slowdown in activity, while it remains to be seen what impact public sector job cuts and, at some stage, an increase in interest rates, will have on the market. The percentage of borrowers whose mortgages are on fixed rates has fallen massively over the last two years, so there will be little protection against any increase in mortgage costs when rates rise. Combined with increasing unemployment we will sadly see an upturn in people defaulting on loans and an increase in repossession numbers.

So, while on the surface, today’s figures are good news for homeowners, there are many underlying issues that threaten to destabilise the market. As conditions deteriorate, it is important that consumers and corporate vendors choose the right estate agent to ensure they recoup their investments.

Victoria Hartley at Mortgage Solutions interviews Dominic Toller

PropertyEarth.net relaunches: Now it’s even easier to find a property bargain online

Ahead of its first anniversary, PropertyEarth.net, the chain-free property portal, has been revamped. The website, which caters for a primarily niche audience of property investors and has already achieved 1 million page views, is now quicker and easier to use.

PropertyEarth.net allows consumers to search an average 2,000 chain-free properties by area, specification or rental yield, directing them to the appropriate selling agent for a speedy sale. Website users can now also choose the format that they view properties in and take advantage of a more efficient listings and mapping service which allows them to switch between different views of the property.

Other features available to prospective buyers include email alerts which notify them when suitable properties become available and when they are reduced in price as well as public notice orders, making users aware of the last chance to buy a repossessed property.

All of the properties displayed on PropertyEarth.net have a highly motivated seller and will therefore be priced to sell quickly. These include lender repossessions, part exchanges taken on by house builders, unsold stock from developers and properties sold following a grant of probate.

Dominic Toller, Managing Director at PropertyEarth.net, comments:

“The changes made to the PropertyEarth.net website are in response to recommendations by users. Although the site has been praised for providing easy access to chain-free properties, we wanted to speed up the search process and make it even simpler for consumers to find a bargain.  

 As the market remains uncertain, increasing numbers of people are looking to source property at a reduced cost and we would hope to meet this increasing demand by continuing to build on our developer and lender partnerships over the next year.”

-ENDS- 

 

NOTES FOR EDITORS

 

About PropertyEarth.net:

PropertyEarth.net is a unique portal that provides consumers with easy access to ‘chain free’ properties. Aimed primarily at property investors, the portal lists lender repossessions, part exchanges taken on by house builders, unsold stock from developers & building companies and properties being sold following a grant of probate. All properties displayed on PropertyEarth have a motivated seller and will therefore be priced to sell quickly.

PropertyEarth allows consumers to search by area, property details and rental yield, and directs them straight to the appropriate selling agent. The business was developed by Managing Director, Dominic Toller, who has been in the property and financial services industry for 19 years.

Visit www.PropertyEarth.net

For further information, please contact:

Suman Hughes/ Laura Scarrott

The Wriglesworth Consultancy

0207 427 1400

s.hughes@wriglesworth.com/ l.scarrott@wriglesworth.com

How to secure that elusive bargain buy

As property prices remain unaffordable for many, homeowners and investors are increasingly looking for new ways of finding property at knock-down prices. PropertyEarth.net, the chain-free property portal, reveals its top tips for securing that bargain buy.

 

Keep it simple

Buying a chain-free property can reduce much of the stress associated with any house purchase, as well as potentially saving you valuable time and money. If you are a FTB there will be only two parties involved in the sales process which means there is less chance of it falling through, not to mention fewer valuations, survey reports and contracts to contend with.

Possess a repossession

The asking price of repossessed properties can sometimes be significantly less than the market rate, in part reflecting the bank and owner’s need for a quick sale. In some cases the buyer will find they are actually able to move into the property in under a month. Repossessions are excellent investor material as often the previous owner will have been unable to pay for the upkeep of the house and with a little work will reap a tidy reward.

Compete effectively

Although a bank will be hoping for the speedy sale of a repossessed property, they have a responsibility to the owner to recover as much as they can. When an offer is accepted on a repossessed property a public notice order will appear in the local paper, in the hope of attracting a higher offer. Keeping an eye on these notices gives buyers the opportunity to act in a competitive market. Registered users of PropertyEarth.net can now get public notice orders emailed to them as soon as a property is under offer, so that they are aware of the ‘last chance to buy’.

Monitor the market

Understanding the market is imperative for any buyer hoping to get a good deal. PropertyEarth.net emails registered users details of any new properties meeting their search criteria – be it area, property style or rental yield – and will let you know when a property has been reduced in price.

Predict housing trends

Homeowners and investors looking to make a profit from their property purchase should investigate areas likely to witness an increase in prices. Areas set to benefit from improved transport links, retail investment or regeneration projects, such as the government’s Sea Change grant, could boost house prices and rental yields. For buyers looking to purchase in an area they are not entirely familiar with, PropertyEarth.net’s automated satellite mapping function can help with an initial investigation.

Dominic Toller, Managing Director at PropertyEarth.net, comments:

“Savvy buyers are continuing to look to cheaper property options as securing mortgage finance remains difficult for many. As interest rates begin to creep up later this year, compounding this problem, I would expect to see a flurry of activity around lower priced properties and on sites like ours which actively seek to help buyers get on the property ladder at a reduced cost.”

Repossessions are down for the time being but expect them to increase

Today’s buy to let figures indicate that investor activity in the market is slowing, supporting our own findings, while the new government’s proposed increase in capital gains tax is also likely to further deplete these figures.

It is no surprise that the number of people falling into arrears and, as a result, the number of repossessions has fallen, with this reflected in current stock levels, but it is unlikely anyone would have guessed the extent to which it would fall. This is due in part to lenders working hard to help borrowers stay in their homes and low interest rates making mortgage debt more affordable. Off the back of this shortage when repossessed stock does become available it is snapped-up by eager buyers.

Although both sets of figures are comforting there is no room for complacency. The inevitable rise in interest rates is likely to lead to growth in the number of repossessions as people struggle to keep up with repayments.

How will the election impact on the property market?

If the coalition government press on with Tory plans to do away with HIPs this will deliver good news for the bank and borrower, who will be able to make that all-important extra saving in the case of a repossession. On the downside, the suggestion that capital gains tax could be as high as 50% come next April could hinder many buy-to-let investors who are looking to leave the market. This problem is likely to be compounded by creeping interest rates later this year.

“In general, property prices remain unaffordable to many, despite low interest rates. This is not sustainable in the medium-term and when interest rates begin to rise prices will have to fall if they are to remain accessible to hopeful buyers. However, we are likely to see demand subside over the new few years as a result of a lack of low cost, high LTV mortgages pushing back prices. The only thing the new government can do to help home owners is to seek to realign UK house prices, interest rates and personal debt.

Dominic Toller’s views on the effect of the election on property

I am no economist but my personal opinion would be that it doesn’t really make much difference whether we have a government with a hung parliament or an overall majority. The facts are that any government will be inheriting a country that is saddled with significant debt.  They will have no alternative but to cut public spending which will inevitably increase unemployment.  They will also come under real pressure to increase interest rates this year, which will put real pressure on homeowners.  The percentage of borrowers whose mortgages are on fixed rates has fallen massively over the last two years, so there will be little protection against the hike in mortgage costs. Combined with increasing unemployment we will sadly see an upturn in people defaulting on loans and an increase in repossession numbers. There are few signs of lenders really going out of their way to help homebuyers by relaxing criteria and reducing margins to improve borrower rates, so housing transactions will not jump up dramatically and nor will property prices. We may see an increase in remortgage numbers if the deals are there to help variable rate borrowers switch to a fix.  But because lending criteria has tightened up so much it may lead to borrowers taking fixed deals from their existing lender rather than remortgaging with a different bank.  My prediction is that we have at least a couple of hard years ahead of us.  If we do end up with a hung parliament, we have to hope that internal bickering does not prevent the government from taking some of the difficult decisions that inevitably lie ahead.

LANDLORD INTENTIONS REVEALED: INVESTORS SEEK OUT FAMILY HOMES FOR LONG TERM RENTAL GAIN

• 3 bedroom houses prove most popular for investors (57%)
• Just 2% of landlords search for single room properties
• Landlords searching for average monthly rental income of £2,470

 

(23 March 2010) New research out today from PropertyEarth.Net, the chain free property website, reveals that a professional landlord’s ideal property investment is a 3 bedroom, terraced house in London.

Quality, Not Quantity

Searches for 3 bedroom houses make up two-thirds (57%) of all of the property searches on PropertyEarth.Net, showing a potential shift from the traditional landlord’s buy to let portfolio made up of one bedroom flats. Backing this up, 2 bedroom properties are the second most searched for size on the website (21%), followed by 4 bedroom properties in third place (15%). The data also revealed that at opposing ends of the scale, landlords looking for a rental bargain are more likely to search for a large property with 7 bedrooms than a more compact 1 bedroom flat. 

The appeal of larger properties lies in their security as long-term investments.  Professional investors with large portfolios of small properties were left burnt during the property crash when tenants were unable to meet rents by themselves. By renting out properties with more bedrooms, landlords are able to spread the risk by either renting out rooms to different tenants, or focusing on the more stable family rental market, which offers security through longer rental terms.

 

The majority of searches on PropertyEarth.Net are for terraced houses with more than one bedroom (37%).  The least popular properties are bungalows (3%) and maisonettes (1%).

 

Capital Amenities vs. Northern Delights

London was the most searched for property location, receiving twice as many searches (18%) than Lancashire (8%). These statistics indicate that property investors are attracted by the rental yield potential of the capital, with the average 3 bedroomed property receiving an average of  £2,470* a month in rent**,

Other than London, the North West attracted the most attention, with Lancashire (including Manchester, Oldham and Blackpool), Cheshire (including footballer’s favourites Chester and Wilmslow) and Merseyside (Liverpool) all featured in the top ten searches.

Dominic Toller, Managing Director of PropertyEarth.net, said:

“We are seeing the beginning of a new buy to let age, where landlords build portfolios made up of larger houses, rather than simply one bedroom flats. The saturation of the buy to let market by small city based apartments, and the subsequent problems of low occupancy have taught landlords to spread their rental risk and engage a different type of tenant. Smart landlords are searching for chain free properties, as their rental yields are on average 2% higher than on the open market. We have yet to see any impact of the upcoming HMO legislation upon our search data.

“By concentrating on quality rather than quantity, landlords set themselves at the forefront of the buy-to-let market.”

CHAIN FREE PROPERTIES SELL 89 DAYS QUICKER THAN OPEN MARKET AVERAGE

CHAIN FREE PROPERTIES SELL 89 DAYS QUICKER THAN OPEN MARKET AVERAGE

Property chains cause huge inefficiencies in the property buying process, as proven by new information released today by Propertyearth.Net, the chain free and repossessions website. These statistics show that the average chain free property on PropertyEarth.Net takes just 54 days to sell* (7.8 weeks), from notification of sale to completion. This is in comparison with a property on the open market, which takes on average of 143 days** (20.4 weeks) to complete the same process.

This figure shows that the existence of a chain leads to an increase in the property transaction time of 62.1%.

Dominic Toller, Managing Director of Propertyearth.net commented on the findings:

“The longer that a property transaction takes, the more opportunity there is for it to break down. By buying a property with no chain, buyers are minimising this risk.

There is a dramatic difference between how long it takes to sell a property listed on Propertyearth, and those listed elsewhere which is primarily due to the motivated nature of the sellers on the website. As many of our properties are repossessions, it is in the seller’s interest to move the process along as quickly as possible, for the best possible result for both the buyer, and the seller.”

-ENDS-

Notes to Editors

* Propertyearth.net internal data, taken from a representative sample of properties sold June- November 2009

** Number of days from Notification of Sale to Exchange = 58.8 (Hometrack, 2009) in addition to average length of conveyancing process to completion = 84 days (Philips Law, 2009) leads to an average time from Notification of Sale to Completion of 142 days.

PROPERTYEARTH COMMENTS ON GOOGLE’S POTENTIAL ENTRANCE INTO THE UK PORTAL MARKET

Dominic Toller, Managing Director of PropertyEarth.net, the chain free and repossessions portal, commented on the potential for Google to move into the UK property portal market:

“It is interesting how quickly the portal market continues to change. The entrance of Google into the UK property portal market will threaten the hold of Rightmove and the large whole of market portals, but shouldn’t affect the smaller, more specialised providers. Smaller portals serving dedicated, niche markets will certainly still have a place under the introduction of this new technology.”