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Property News

Here is the most recent property-related news brought to you by Leeds Property Networking - Not Just Property Networking

 

Summary of News Week-Ending 7th November 2009

 

 

 

 

 

Economy

Extra £25bn to stimulate economy
The Bank of England's rate-setters have decided to pump an extra £25bn into the economy in their quantitative easing (QE) programme. They also kept interest rates unchanged at 0.5% for an eighth month. The Bank has already spent £175bn on QE, which involves printing money to buy assets from banks and other companies to stimulate the economy. The extra £25bn will be spent over the next three months, which is a slower rate of spending than before. In the previous three months the Bank had spent £50bn.
To read this story on the BBC website, follow this link >>>

British families remain pessimistic
Economic conditions across the country are showing some signs of improvement but consumers remain unconvinced. Twenty one per cent of people living in Britain believe that their standard of living will worsen over the next 10 years, according to a poll carried out by Ipsos MORI. In a similar poll conducted five years earlier, that figure was just 14 per cent. It is hardly surprising that consumer confidence is low at a time when the economy has ground to a halt but the statistics appear to indicate that some families believe they will continue to struggle to maintain their standard of living even when the economy does improve.
To read this story on the FT website, follow this link >>>

Housing Market & Prices
 
Signs of slowing housing demand
House prices have edged upwards for the third consecutive month in spite of signs of a slowdown in demand from new buyers, according to Hometrack, a research company. Its monthly survey of estate agents and surveyors in England and Wales showed that house prices grew by 0.2 per cent in October, bringing the year-on-year change in house prices to -4.2 per cent. Richard Donnell, director of research, said recent surveys showed a marked slowdown in the rate of growth in the volume of new buyers registering with agents. "This suggests that the pent up demand that has boosted the market in recent months is starting to fade in the face of firmer pricing and fewer clear bargains."
To read this story on the FT website, follow this link >>>

...and in a story based on Halifax's recent report, spells out a similar cautionary tale...
 
House price recovery continues
Recovery in the UK housing market is continuing at a strong pace, according to a closely watched index, with prices in October posting gains for the fourth consecutive month. The Halifax House Price Index registered a 1.2 per cent rise for the month, much stronger than the 0.4 per cent gain seen in the Nationwide's index for the same period. Year on year, house prices now stand only 4.7 per cent below their levels of one year earlier, on the Halifax measure. Halifax said the latest rise leaves average house prices 7.1 per cent above the trough for the market set in April. Indeed, many economists remain sceptical about the durability of the house price recovery, noting that the number of monthly transactions is very low by historical standards...and something we at LPN have been commenting on for some time!
To read this story on the FT website, follow this link >>>

...and again, supported by a further report from a leading Estate Agent...
 
House price rebound expected to end next year
The housing recovery will come to an end this year because of the lingering effects of the weak economy, according to forecasts by a leading estate agent. Values are expected to weaken in both the mainstream and prime residential markets in 2010, according to forecasts for the year ahead by Savills. However, the sectors are expected to be affected to differing degrees as the return of bonuses next year begins to help the more expensive parts of the market. The main UK market is forecast to fall by 6.6 per cent in 2010, according to Savills, before returning to growth of 2.7 per cent in 2011, with stronger gains of 5.5 per cent and 8 per cent in 2012 and 2013. Savills expects the backlog of demand from equity-rich buyers to erode into 2010 as supply increases and positive sentiment wanes.
To read this story on the FT website, follow this link >>>
To read this story on the BBC website, follow this link >>>

Housebuilders' fortunes turn as investors return to fold
Shares in UK housebuilders rose strongly on Wednesday after the completion of £700m of rights issues announced last month and positive updates from two of the UK's largest listed builders. Analysts said the robust share price performance, which saw about £540m flow into the sector's eight listed companies and drove the stocks of Barratt and Persimmon to rise more than 10 per cent, was a response to the placing of the rumps of Barratt's £550m and Redrow's £150m rights issues. Chris Millington, an analyst at Numis, said the 92 per cent and 97 per cent take-up of the rights issues eased concerns that existing investors would be reluctant to pump more money into the sector.
To read this story on the FT website, follow this link >>>

Housing purchase investment fund debuts
A new type of fund focusing on UK residential property in London and the south east is being launched today, aimed at institutional investors and would-be buyers trying to get a foot on the housing ladder. The £500m (€558m, $822m) Investors in Housing fund will work on a co-investment basis where the buyer acquires 25-50 per cent of the property via a conventional mortgage with the fund buying the rest. Buyers will pay a monthly indexed investment fee, based on market rent, on the part of the property they do not own. They can buy out the fund's interest at any time.
To read this story on the FT website, follow this link >>>

...and from a different source of property news...
 
Ahuja Group Appear on London's Inside Out
If you know anyone interested in investing with either Ajay Ahuja or the Ahuja Group, you should make sure they watch this short clip (just 10 minutes) from BBC London's Inside Out programme. It also features Paul Shampolina.
To watch this story on the BBC iPlayer, follow this link >>>

Hammerson confirms real estate recovery
Hammerson, the FTSE 100 property developer, has confirmed the recovery in real estate prices in the UK although warned that rents have continued to come under pressure. Hammerson, which owns a UK and French portfolio split between offices and retail, said improvements in global financial markets, increased economic activity and low interest rates have helped to increase demand for property. Prices have improved in the UK, according to Hammerson, although it also cautioned that the market outlook remained uncertain, in part to the high level of property debt that needs to be refinanced over the next few years. The interim management statement for the four months to November 3 did not provide an update on valuations.
To read this story on the FT website, follow this link >>>

Were you wondering what was to become of the US Embassy in Grosvenor Square...?
 
Qataris buy US Embassy building in London
The United States has agreed to sell its embassy building in Grosvenor Square, Mayfair, to Qatari Diar, the sovereign wealth-backed developer, for an undisclosed sum. The US State Department said that it will sell the Chancery building, home to the US Embassy in Britain for almost half a century, to the property investment company owned by the Qatar Investment Authority (QIA). The development value of the site suffered a setback last month when English Heritage granted Grade II listed status to the building, designed by the American architect Eero Saarinen, for being a "really important piece of Modernist architecture". The listing means that the new owners will not be allowed to change the facade, which includes the famous 35 ft gilded aluminium eagle that hovers above the main entrance. 
To read this story on the Time Online website, follow this link >>>

Mortgage Lending
 
Northern Rock accelerates mortgage lending
Northern Rock, state-owned bank, accelerated mortgage lending to customers in the past three months, which is expected to contribute to an improved performance in the second half. The Newcastle-based lender said on Wednesday that third quarter figures to September 30 would show an improvement on an underlying and statutory basis following higher net interest income and lower loan loss impairment. Statutory year end figures from Northern Rock would also be boosted by the recognition of a £445m rebate after European regulators last week approved a UK government plan for a radical restructuring of the bank, allowing it to split itself into two. It has a target from the government to help revive Britain's sluggish housing market with lending of about £4bn of new mortgages in 2009 and £9bn from 2010...
To read this story on the FT website, follow this link >>>

Banking
 
Good news for borrowers...maybe not so good news for lenders...
 
High Street banks to be broken up
Chancellor Alistair Darling has confirmed that Lloyds, RBS and Northern Rock will be broken up and parts sold to new entrants to the banking sector. He said there could be three new High Street banks in the UK over the next three to four years as a result. But the chancellor said he would only sell parts of the banks when "the time is right", to ensure taxpayers get their money back. There is speculation that buyers might include Tesco and Virgin.
To read this story on the BBC website, follow this link >>>

UK to inject £37bn into Lloyds and RBS
The UK government on Tuesday doubled its bet on bailing out Britain's two part-nationalised banks - Royal Bank of Scotland and Lloyds Banking Group - adding up to £37bn of new money to the same sum it first injected a year ago. The latest chapter in the bail-out saga makes RBS by far the world's biggest government rescue, taking as much as £53.5bn of state money, compared with the $45bn (£27.4bn) absorbed by Citigroup in the US. Lloyds, by contrast, sought to emphasise its commercial viability, launching a £13.5bn rights issue, the biggest ever, to which the government will contribute £5.9bn in line with its 43.5 per cent stake. The bank also confirmed details of a plan to switch existing debt into £7.5bn of contingent capital instruments that could be converted into equity in case of crisis.
To read this story on the FT website, follow this link >>>
To read this story on the BBC website, follow this link >>>

...as well as refinancing, banks should also take heed of a recent survey on customer service...
 
Banks should focus on service
One in five people has changed their bank during the past two years because they were unhappy about the way they were treated, according to a survey. Twenty one per cent of people questioned by YouGov for Deloitte, the business advice group, said they had moved their account after receiving poor service. The research also found that the existence and accessibility of branches, along with face-to-face interaction, remained a key consideration for customers with more than half saying they would only place their savings in a bank with branches they could visit and 65 per cent saying they would only take out a mortgage after speaking with an advisor face-to-face.
To read this story on the FT website, follow this link >>>


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...and links to our news archive:


 

 

October 2009

 

September 2009 - Not yet updated!

 

August 2009

 

July 2009

 

June 2009

 

May 2009

 

April 2009

 

 


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