Posts with tag: help to buy scheme

Landlords not Worried about Help to Buy Scheme

Published On: November 15, 2013 at 3:47 pm

Research from the National Landlords Association (NLA) has found that private landlords are not worried about the affect of the Government’s Help to Buy initiative on the private rental sector.

Landlords not Worried about Help to Buy Scheme

Only one in five (21%) of landlords have said that they’re concerned about the Help to Buy system causing an impact on the market, together with just 15% worried that it will cause damage to their own lettings businesses. These figures are based on research from the NLA Q3 Landlord Panel of 1,019 respondents.

The Government’s new home ownership scheme has already seen more than 2,000 offers, contributing to a reported £365m worth of mortgages. Concern has been raised over whether these statistics might affect the demand for private rented properties.

The Chief Executive Office of the NLA said that it is too early to know whether Help to Buy will have a definite impact on the need for private rentals, and the findings “seem to confirm our belief that it will only affect the margins of the private-rented sector and that it doesn’t present a major concern for landlords at large.”

The Help to Buy scheme is currently creating a discussion on whether another housing bubble will arise. Lambert insists, however, that this debate is motivated by a bigger issue: “There are simply not enough homes for people, regardless of whether they want to rent or buy.”

This indicates that the private-rented sector will still play a crucial role in meeting the demand for more housing. “It is likely that renting for longer periods will become a normal part of our housing biographies,” says Lambert. “As such, the priority for the NLA is to ensure that rented homes are both enjoyable places to live and viable places to invest.”1

1 http://www.landlords.org.uk/news-campaigns/news/help-buy-no-problem-landlords

Help to Buy Not a Problem for Landlords

Published On: November 14, 2013 at 12:07 pm

Author: Em Morley

Categories: Finance News

Tags: buyers affect on rental market,help to buy scheme,renting for longer periods

Research from the National Landlords Association indicates that only a small number of landlords are unduly worried about the effect the Government’s Help to Buy Scheme will have on the rental sector.

The findings revealed that only 21% of landlords said they were concerned about the introduction of Help to Buy on the rental industry. Just 15% said that they were concerned about the scheme having a detrimental effect on their individual businesses.[1]

Offers

In excess of 2,000 offers have been made using this new Government scheme, assisting approximately £365m worth of mortgages.[1] However, these statistics have led to concern that demand for privately rented properties may be affected.

CEO of the National Landlords Association Richard Lambert, said it is still “too soon to predict whether Help to Buy will have any real impact on the level of demand for private rentals.” Postively, Mr Lambert feels that the Help to Buy scheme “doesn’t present a major concern for landlords at large.”[1]

Help to Buy Not a Problem for Landlord

Lambert goes on: “Much of the debate around Help to Buy is currently centred on the whether the scheme will create another housing bubble. However, this conversation is itself driven by the much bigger issue at hand: the fact that there are simply not enough homes for people, regardless of whether they want to rent or buy.”[1]

With insufficient housing to meet demands, Lambert professes that “the private-rented sector will play a vital role” and suggests that “renting for longer periods will become a normal part of our housing biographics.”[1]

[1] http://www.landlords.org.uk/news-campaigns/news/help-buy-no-problem-landlords

Building more Houses will Stabilise the Market

Published On: July 15, 2013 at 12:52 pm

Author: Em Morley

Categories: Property News

Tags: future housing market recovery,help to buy scheme

Many industry experts are warning that the current housing market recovery could be soured if more long-term measures are not put in place to further stabilise the market.

Help to Buy

A number of experts are concerned about the legacy of the Help to Buy scheme. The scheme was implemented in order to assist first time buyers, with just a 5% as opposed to a 20% deposit required in order to secure a property. Under the scheme, it is possible for buyers to have a 5% deposit, 75% mortgage and 20% loan, with is funded by the tax-payer.[1]

While critics acknowledge that the scheme is a good short-term fix, which will get the housing market moving, they warn that the long-term effects could be catastrophic.

Increases

Some industry economists are suggesting that by the end of 2014, average house prices in the UK will have risen by as much as 15%. Some even suggest that this number could be even higher.

Online property website Rightmove said recently that house prices in all regions, “are up year on year for the first time in nearly three years contributing to the positive national picture.”[1]

Building more Houses will Stabilise the Market

Rob Wood is an analyst who oversaw the last house market increase and subsequent slide from the inside of the Bank of England. Wood believes that after 2015, prices of property will rise to new heights. However, rising property prices, coupled with static wages have lead him to raise his concerns that there may be another housing bubble.

Wood said: “House prices thus reach the heart of Britain’s current policy paradox. Loose monetary policy works by boosting asset prices and encourage households and firms to spend now and save later. That boost can cause depression. But it can only delay the inevitable adjustments of saving, spending and house prices.”[1]

Mr Wood suggests: “To keep the economy alive today, policy has to do the opposite of what is needed to keep it alive tomorrow. The positive way this plays out is that the UK adjustment is less painful in the future. Eurozone austerity is due to ease off next year and the US will be through the fiscall cliff. With a stronger world, UK adjustment could be less difficult in the future.”[1]

For Wood, it is too risky for the UK to have to depend on other countries for bail. Instead, he feels that the best way to solve the issue is to build more houses to cope with demand and for a cheaper price. He believes that this will not only improve housing prices but will reduce unemployment.

[1] http://www.justlandlords.co.uk/news/Building-more-Homes-will-Stabilise-the-Market-1759.html