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British people dream of a four bedroom home by the sea equipped with high tech
A four bedroom home near a beach or a city centre is the most sought after dream homes in the UK, according to new research. Some 45% dream of a home built to their own specifications designed by an architect or themselves but only 38% think they'll only get to live in their dream house if they win the lottery and 26% don't think they'll ever achieve it. Most people would want an array of high technology and glamourous features that costs £3 million, the research from home buyers estate agency Tepilo found. It also found that 48% would want en-suites in every bedroom and the same number a television or cinema room, while 47% want a huge kitchen with its own kitchen island and the same number a huge garden. Other top desires were walk-in wardrobes and dressing rooms, an indoor swimming pool, a conservatory or orangery, open fires and wood burning stoves, a double front door and his and hers bathrooms. Some 38% want high technology security features, and a further 35% say they'd want their dream home to contain a series of mods cons such as remote controlled heating, lighting and sound systems. Other things near the top of the list are a balcony, a relaxation room, a library, a gym, a separate granny flat or guest lodge, a wine cellar, an aquarium, a bowling alley and a bar. On a beach is the most popular location with 16% wanting a view of the sea but another 16% want to be in a city centre, 11% in the countryside, 10% in the suburbs and 9% in a village. Some 29% want four bedrooms, 27% want three bedrooms and 21% would want a house with five bedrooms. Only 11% would want six or more bedrooms. Meanwhile 14% want a cottage, 12% a huge mansion, 13% a detached bungalow, and 13% a modern home. Amazing views from the garden are important for 52%, 40% want a built in barbeque, 38% a large veranda, 34% a big garage, 30% a water feature, 30% a sweeping driveway, 30% separate out buildings and 20% a children’s play area. ‘What's also interesting is the amount of money Brits would spend on their dream home, despite money being no object. Up to £3 million seems a pretty low price to pay for the ultimate pad, but it demonstrates that we're a price orientated nation that expects value for money when it comes to property,’ said Sarah Beeny, owner of Tepilo. Continue reading
Mortgage lenders concerned about impact of banking reforms on UK housing market
First time buyers and housing associations in the UK could bear the brunt of banking reforms which affect credit risk, it is claimed. Proposals from the Basel Committee on Banking Supervision to revise its standardised approach for credit risk could adversely affect parts of the UK housing market, according to the Intermediary Mortgage Lenders Association (IMLA). The Basel framework ensures that banks, building societies and other deposit taking institutions have sufficient capital for the underlying risks they bear. While supporting this objective, the IMLA has raised significant concerns over some proposed revisions in the latest Basel consultation, which it argues are not justified by differences in risk and could limit access to mortgage finance in key areas of the UK housing market. In particular, one of the most serious impacts could be on lending to UK housing associations. By preventing lenders from taking into account borrowers’ financial strength, the Basel proposals could see loans to many housing associations redefined and subject to much higher capital requirements, despite the exemplary payment track record and their government regulated status. The same proposals mean the regulatory cost of buy to let lending could far outweigh the risks involved, as they do not accommodate the fact that many buy to let borrowers are substantially more financially secure than the average owner occupier. IMLA also strongly disagrees with proposals which could distort mortgage pricing and push up the cost of higher loan to value (LTV) mortgages, which are relied on by many first time buyers to become home owners. Doing so could incentivise them to seek out unsecured ‘top up’ loans to fund their house purchases with a lower LTV mortgage, which would be potentially harmful to their finances. The IMLA’s consultation response highlights how aspects of the Basel proposals could create a ‘bizarre’ situation where unsecured lending can be given a lower risk weighting than secured lending to the same borrower. It could also penalise lenders that have adopted conservative lending standards and create an artificial incentive to lenders to remortgage or ‘churn’ customers, creating outcomes that would not be deemed good for either the customer or the lender. ‘It is vital to have the right checks and balances in place so lenders can provide mortgage finance where there is a legitimate need while maintaining a stable UK housing market,’ said Peter Williams, IMLA executive director. ‘The Basel consultation sets out with the important aim of ensuring capital requirements are appropriate to the underlying risk, but we are concerned that the current proposals will not meet this goal,’ he explained. ‘Government and industry need to work together to bring greater balance to the UK housing market. This includes ironing out the technical details of the Basel proposals to defend consumer interests across all housing tenures,’ he added. Continue reading
New property tax in Scotland raises less than expected on residential properties
Revenue from the Land and Building Transaction Tax (LBTT) in Scotland failed to reach forecasts for residential sales in the 2015/2016 financial year. The Scottish Government has hoped to raise £235 million but the published figures show it was £201 million, some £34 million below expected and 26% below the £270 million collected the year before. However this fall is likely to have been exacerbated by property market activity brought forward at the end of 2014/2015 as buyers raced to beat the new LBTT when it was introduced in April 2015. LBTT replaced stamp duty on all residential purchases in Scotland and the new rates make it more expensive to purchase property with a value above £333,000 compared to the rest of England and Wales. This is especially the case in the prime market where costs are as much as 90% higher than under the previous system. ‘While the introduction of LBTT in April 2015 resulted in a welcome reduction in purchase costs for a significant number of home buyers in Scotland, the flipside of this was a substantial increase in taxes for those at the top end of the market,’ said Oliver Knight, a senior analyst with Knight Frank Residential Research. ‘Last year, we raised concerns that levying these rates for higher value homes could reduce transaction volumes and ultimately have a negative impact on tax receipts. Policymakers may need to consider allowing some room for manoeuvre on LBTT rates if they find that they continue to impact on activity at this end of the market, and if they want to hit next year’s forecast of £295 million in revenue,’ he added. He explained that one reason for the shortfall in forecast versus actual revenue in 2015/2016 has been the effect of forestalling whereby some transactions were completed earlier than they otherwise would have been to ensure they were assessed under the old SDLT regime. The latest available data from the Registers of Scotland shows that 62% of all residential sales above £1 million in Scotland in 2015 occurred in the first three months of the year, prior to the introduction of the levy. However the amount for commercial property was higher than expected. The Scottish Government had expected to raise £146 million on non-residential property but actually raised £214.2 million, some £68.2 million more than predicted. Blair Stewart, partner in Strutt & Parker's Edinburgh office, pointed out that the LBTT residential shortfall was significant and highlights a weakness in relying on too narrow a band of high value sales. ‘While the commercial LBTT tax revenues came to the rescue this year, the forecast for the next five years is steadily more dependent on high value sales. Equally, the end of the year was distorted because significant numbers of people were buying properties before the LBTT surcharge kicked in. This will not be the case in future years,’ he said. ‘While the whole housing market is improving in terms of sales volumes the… Continue reading
