Tag Archives: finances
Research reveals how little mortgage holders in UK know about their finances
Almost half of all UK mortgage holders are unaware of their current mortgage rate and over a third are surprised to learn that if the base rate rises by just 1%, it could add £91 to the average UK variable mortgage payment. The figures, from research conducted by the Keep Me Posted campaign, suggests that many home owners with a mortgage don’t know enough about their finances. Overall 42% don’t know what the current rate is, 31% think they will have to make sacrifices if the interest rate rises 1% and 11% would get into financial difficulty. The research also found that when asked how they would like to be notified of a change to their mortgage rate, 67% preferred a printed letter, rising to 77% of those aged over 55. This is compared to just 22% who would like an e-mail and 5% who would like a text. Furthermore, 65% of mortgage holders admitted that a printed letter would make them most likely to take action including shopping around for a better deal compared to just 23% for e-mail and 5% for text. When asked how a base rate rise would affect them, 31% of mortgage holders polled believed that a rise of 1% would not be affordable. Of these, 20% state that they would have to make significant sacrifices to afford their mortgage, and 11% think it would tip them into financial difficulties. A further 42% claimed they could afford it but they would find themselves financially stretched by this change. ‘There’s no doubt that at present, a large number of people stand to be affected significantly if the base rate rises, meaning many may be left struggling to afford their monthly mortgage payments,’ said Judith Donovan, chair of the Keep Me Posted campaign. ‘What was particularly shocking to us was the number of people that currently aren’t aware of their mortgage rate. It is also clear from our research that home owners are more likely to react to any changes if notified via a posted letter. Companies should be aware that digital channels may not be suitable for all their customers and should be careful not to take a one size fits all approach,’ she added. Keep Me Posted champions communications choice for everyone in society. The campaign believes that when it comes to important financial information, consumers should be communicated with in a manner more likely to encourage them to take the best action for them. More importantly, consumers should be able to choose how they are communicated with by their service providers. The campaign believes legislative and regulatory action needs to be taken before this becomes a serious issue. Continue reading
Australian new home approvals at high levels, but uneven across states
New home approvals in Australia bounced back in July and remain at very high levels by historic standards, according to the latest figures from the Australian Bureau of Statistics (ABS). During July 2014, a total of 16,320 dwellings were approved, a 2.5% increase on the previous month. Compared with the previous three month period, approvals were also up by 2.5% and over the 12 months to July new home approvals totalled 195,227. The increase in building approvals nationally during July was driven largely by a 23.1% increase in Western Australia in seasonally adjusted terms. In Queensland approvals were up by 0.9% but there were significant declines in other states, led by a 7.7% fall in Tasmania, followed by a 5.7% decline in New South Wales, a 4.6% decline in Victoria and a smaller fall of 1.9% in South Australia. In trend terms, new home approvals increased by 16.7% in the Northern Territory but fell by 9.3% in the Australian Capital Territory during July. ‘These figures mean that Australia’s home building industry has broken yet another record this year. Total seasonally adjusted new home approvals over the past 12 months are the highest since records began back in 1984. Having broken through the 195,000 threshold for the first time, new home building approvals is now at an even higher level than during the 1994 building boom,’ said Housing Industry Association senior economist Shane Garrett. However, he pointed out that despite this achievement, there have been signs of slowdown in new home building approvals over the past six months. ‘It is also worth bearing in mind that the bulk of the July increase was driven by an exceptional large expansion in Western Australia,’ he said. ‘The key is to ensure that a number of markets, like Sydney for example, achieve sustainably healthy levels of new home over the coming decade which far outweigh what has been built over the last ten years. Numerous government policies across all tiers stand in the way of this objective being achieved,’ he added. Other ABS figures show residential building work done continued to strengthen in the June 2014 quarter, following healthy growth in March. There was $13.4 billion of residential building work done, some 2.2% higher than in the previous quarter and 9.6% higher than in the June 2013 quarter. ‘These preliminary figures indicate that new home building activity is likely to represent a positive contribution to overall GDP growth in the national accounts figures to be released next Wednesday,’ said HIA economist, Diwa Hopkins. She explained that a closer look at these preliminary results shows that the detached house segment was the key driver of growth in residential building during the June 2014 quarter, compared with the March quarter when multi-unit building led the charge. In the June 2014 quarter, new house building work contributed 1.6% points to the 2.2% growth in total residential building work done. ‘These developments are largely in line with what… Continue reading
Almost a third of families move house to get kids into a good school
Nearly a third of parents have moved house in England to be in the catchment area for a good school, new research shows. Also 10% are willing to pay in excess of £50,000 for a property in a desirable school catchment area and 24% would consider renting an extra property in the catchment, according to research from price comparison firm Confused.com. It also shows that 18% admit that they started thinking about what school to send their child to before they were even born. The study suggests that inflated house prices in good state school catchment areas actually mean it may be cheaper for parents to send their children to local private schools. Compared to the average house price in England of £275,721, the typical price of a house close to Lowbrook Academy, Maidenhead, one of England’s best state schools, is £481,023. According to calculations, it would be cheaper for families to educate a child at a local private school than to borrow the money needed to move into the Lowbrook Academy catchment area. Many parents are even willing to ‘cheat the system’ to secure places at the most sought after schools in the country. Some 9% admit to having given a false address within the catchment area of a good school to ensure their child got a place there, while 24% would consider renting an additional property in the catchment area for a good school to help secure a place for their child. Other tactics that parents admit to adopting to help get their child into their school of choice include feigning religious observance to get into a well performing local school (7%) or falsely claiming that a sibling already attends a local school to increase their child’s chances of acceptance (4%). Some parents also admit that they would be willing to pay for extra tuition to try and nab a place at a well performing school (16%), while others admit that they would send their child to a nursery simply because it had links to a good primary school (27%). The race to secure a place at a good state school means that some parents are now making decisions on where they will live before their children are even of school age. Some 18% admit that they started thinking about what school to send their child to before they were even born, with a further 12% going as far as putting their unborn child’s name down on a school waiting list. The findings come amid mounting concerns over rising primary school populations leading to a shortage of school places for children. Recent figures from the Department of Education show that six primary schools have classes with just one teacher to 70 children, while nearly 100 have classes with at least 50 pupils. Analysis suggests that at the current rate, the number of pupils in large classes will reach almost half a million by 2020. ‘Although household finances remain stretched, it is significant to see from our research that a number… Continue reading
