How to save up for a deposit for a house

In today’s budget the Chancellor announced more support for people wishing to buy their own homes, but will it make things easier for you and how can you go about saving up a deposit of your own?

The additional support for would-be home owners comes in two forms.  Firstly the New Buy scheme is being expanded.  This scheme helps buyers secure a mortgage by reducing the level of deposit that you have to raise on your own.

It’s effectively an interest free loan from the Government which you can put towards your deposit and pay back when you sell the house.  This scheme will be available to anyone buying a new home under £600,000.  The second support mechanism will be launched in 2014 nd will be a guarantee provided to banks against mortgages, effectively allowing banks to reduce deposits to 5% without taking on so much risk.  Think of it as an insurance policy for banks.

So where does this leave you?

If you are thinking about buying a house you will likely still have to raise some kind of deposit – whether it’s 5% or 25% – so how do you go about saving this?

One way is to get an ISA in each tax year so you can put your savings into an interest free savings account.

For 2013/14 the annual ISA investment allowance will be  £11,520, of which £5,760 can be saved in a cash ISA and the remainder  can be invested in a stocks and shares ISA.  If you do not use your ISA allowance for a given year then you lose it, so it can be prudent to use your allowance each year to maximise your tax free savings.

The difference furniture can make

In a competitive rental market, every landlord will want to do the best they can to ensure an attractive rental rate. A key issue to consider is whether it’s worth furnishing a property – or not. It’s no small decision of course, furnishing a property requires a major commitment, and a lot of cost – so it is really worth doing it? We weigh out the pros and cons to help you decide what the best way forward for you is.

Why furnish – the pros

Presenting a fully furnished property immediately creates an attractive first impression – one that tenants can imagine moving into straight away. For many tenants, a furnished property is a cost-effective solution, as they don’t need to invest in providing their own furniture themselves – in fact, most tenants will look for a furnished property as a priority when selecting a place to live. As a result, furnished properties are often let a lot sooner than unfurnished properties, saving both the landlord, and the tenant, a lot of time and hassle.

Furnishing can be a costly endeavour – but with careful thought and planning, this can be a worthwhile investment. After a tenant leaves, the furniture still belongs to you, and you can use it yourself – or choose to pass it on to future tenants. To ensure longevity, it’s worth investing in high quality staple furnishings, that are both attractive and practical. Key items include those that will receive the most amount of wear and usage, such as a good quality chest of drawers, bedding, and living room furniture. Rather than going for trend-led designs, classic styles that can easily be adapted to individual tenant’s tastes are a better choice.

What are the cons?

While furnishing a property creates an attractive first impression, for some tenants and landlords, choosing to keep a property unfurnished is a better option. The advantage of this is that it can attract tenants who wish to stay on a longer term – for tenants who invest in their own furniture, they may prefer to avoid the costly and complicated process of having to move again.

Letting tenants choose their own furniture also removes the hassle of checking for wear and tear, by leaving the responsibility to tenants themselves. By allowing tenants to pick and choose their own surroundings according to their own tastes, they’re also likely to be less problematic, as they’ll be happier with their home.

Is there a middle way?

The middle option is to leave it ‘part-furnished’. This gives both you and your tenants the flexibility to invest in key basics which they might not want to source themselves – such as beds, wardrobes and heavy kitchen units. This allows your tenant the choice to select other items which they can choose according to their own tastes and styles, giving them a feeling of involvement in their own home – without being forced to invest extensively in furnishing the property themselves.

However you choose to furnish your property, it’s important to protect both you and your tenant. Ensure that all furnishing and appliances meet up to date safety standards – while this is not a legal requirement, it does help to prevent any issues arising in future. It’s also worth investing in insurance for any furniture you buy – again, while it’s not an official requirement, it certainly gives you some practical protection for your property.

Where Capital Growth Was Once King, Rental Income Now Reigns

A guest post by commercial property management specialists Eddisons.

The credit crunch impacted on many investment areas and commercial property was no different.  However, the sector is now becoming a viable option again, as investors look for more stable options, with cash and bonds returns continuing to fall.  But where it was once the opportunity of capital growth that drew investors to commercial property, it is now rental income that pulls them in.  So, what is it about commercial property rental income that makes it such an attractive proposal?

Stable Income

Whilst figures vary slightly throughout the UK, commercial property can yield in the region of 6% per year.  What is more appealing is the length of the contracts that commercial property can command.  Whilst residential property tends to be rented on a 6 or 12 monthly basis, landlords of commercial property can expect contracts of 10 or even 20 years.  This obviously offers great stability to the landlord and plenty of time to negotiate a new contract or find a new tenant should the current one signal their intention to leave.

Increasing Demand

The value of UK commercial property decreased a national average of 2.3% during 2012.  Although property prices in London fared much better, they still remain 21% below their peak price of 2007.  This of course mans that there are some good deals to be had by investors.  With the construction industry still struggling to recover and few new buildings planned, the demand for commercial property is increasing and will continue to do so in the coming years.  Even once construction levels do increase; it will be some years before the properties are ready to welcome tenants.  The situation will only help to strengthen the hand of commercial landlords and the rental figures they can command.

Inflation-proof

All UK commercial property has index-linked rent reviews that are carried out on a regular basis.  This allows rental figures to stay in line with increasing prices; thus protecting against inflation.  This low risk investment is further sweetened by the fact that tenants are responsible for the upkeep of commercial property, which is not the case with residential property.  This hands off landlord approach is desirable to investors with other business interests to juggle.

Easy Entry and Exit

Commercial property does of course tend to be more expensive than residential property, but the prices are not a barrier to anyone looking to invest.  Property funds and Real Estate Investment Funds (REIFs) offer a route into the sector; allowing investors to buy shares to the value that suits them.  Should the investor wish to liquidate their assets, this arrangement also allows for a quicker and simpler exit; with shares being much easier to sell than a whole property.

Solid Foundations

The UK commercial property sector is currently in a strong position; with increasing rents and low capital prices providing investors with solid yields.  There is no indication that this will change in the longer term, making commercial property a viable addition to your portfolio.

London Property Market Continues to Attract Overseas Buyers

London has and always will be a very attractive location for investment, with figures released recently showing that overseas buyers are still very enthusiastic about buying property in the capital. Research by Knight Frank shows that in 2012, £2.2 billion worth of property was bought in London by buyers from overseas.

Overseas interest in London property is certainly nothing new; the UK capital offers some of the most sought-after locations in the entire world, but it may come as a surprise to some that the practice is still so popular in the current economic climate.

It appears as though there have been many buyers in countries where economic performance has bucked the trend and remained stable. The research shows that people from 52 countries all over the world bought property in London in 2012. The biggest share was surprisingly from Singapore, which accounted for 22% of the sales. It’s important to note that these percentages are ranked in terms of the number of transactions, not their value. Buyers from Hong Kong also proved to be great in number, accounting for 16% of sales. There were also considerable purchases from buyers in Russia, China and Malaysia.

Insecurities in the Eurozone have actually been of a slight benefit to the London property market, as some European investors have chosen to diversify by buying property not directly tied to the euro. The pound being relatively weak has also helped foreign investors buy property here in the United Kingdom.

It’s not just financial security and investment which is attracting overseas buyers either. Aside from the fact that London is consistently ranked as one of the most important cities in the world, the education opportunities are second-to-none. This makes the capital one of the best destinations to send aspiring children and students. London’s multicultural credentials also help it to be accommodating to nearly any nationality.

Aside from house purchases, the rental market from overseas is also very strong. Again, this is linked to the education prospects. While there may have been 52 different nationalities that bought property in London, there were in fact 77 that rented last year. Indeed, the number of foreign nationals living in the capital is extremely high; there are more Europeans living in London than the entire population of Frankfurt. There are also more French Londoners than there are French people in the city of Cannes. This is why French schools have cropped up in some of the more affluent areas.

While those in the UK might still be struggling to finance a home purchase or sell their home, with many looking for a quick house sale in order to get what they want, it appears as though overseas buyers are contributing to the slight improvements we’re currently seeing in the market. There are still a variety of incentives around for first time buyers, but more still needs to happen for UK nationals to start buying in force again, especially with the price of housing in London.

Coffee tables are where you’ll find great books

Come winter, we go into hibernation. The majority of our days are spent indoors where we can huddle around a warm heater or blazing fireplace. We find ourselves lounging around on the couch much more often, slippers on and tea in hand.

Coffee tables are the centrepiece of any lounge room. They’re where your remote lands, your tea cools and they’re where you’ll find some of your most interesting books. Instead of instantly reaching for the remote tonight, pick up a book that’s going to grab your attention with a combination of stunning imagery and great writing. This particular genre of book, known as ‘coffee table books’, are aimed at anyone who wants to flick through or do some light reading on just about any topic.

So what are the best coffee table books to add to your collection in 2013?

800 Views of Airports

This strange and quirky concept is a surprisingly interesting book. The 408 glossy pages are filled with the photography by Swiss duo, Peter Fischli and David Weiss, who have been taking snapshots of airports for over 25 years during their travels. Their strangely peaceful transit images juxtapose the usual busyness of an airport and make the whole place feel silent. This expectedly banal topic has been turned into a fascinating coffee table book. The most interesting aspect has to be the technological changes that you can clearly see have occurred in air travel over the last two and a half decades. Plane spotters and travellers alike will love this book.

Wine Grapes

This beautifully presented guide covers everything about wine that any grape juice enthusiast would ever want to know. Written by a trio of experts, Jancis Robinson, Julia Harding and Joes Vouillamoz, this book tells you all about the genetic side of grapes, the history of wine and gives you various vineyard descriptions among other things. And, of course, it includes lists of all the best wines to sample. This wine bible is an interesting read for wine lovers and a fantastic conversation starter for dinner parties.

Edible Selby

Todd Selby is a photographer by trade and his tasty book will take readers through some of the worlds’ most extraordinary and inspired kitchens, homes and gardens. This book has a comforting, homey feel and is full of pictures depicting the most creative figures working in the food industry today. The colourful photos are accompanied by profiles of world-famous chefs, who each include the recipe for one of their favourite dishes. This lively and bright book is for any cooking or food lover.

Photos that changed the world

This book is a compilation of the world’s most remarkable and moving images of events that have changed the world. Although it was released many years ago, Peter Stepan and Claus Biegert’s book continues to interest and inspire people through the iconic images it presents. Well-known photographers like Lewis Hine and Dorothea Lange, as well as lesser known individuals who just happened to be in the right place, at the right time, have images which feature in this important collection. From the bombing of Pearl Harbour to Nelson Mandela’s release from prison, this book will evoke emotions ranging from joy to hope to sorrow and heartbreak. This is a must-have coffee table book for people interested in history or news.

Rogue Landlord Complaints Underestimated?

A survey commissioned by the Housing Charity Shelter has found that complaints over rogue landlords have increased by 27% over the course of the last three years. The stories behind those figures are quite alarming but the Charity feels that the actual numbers of landlord problems are even higher and that many tenants are simply not reporting their problems through fear of reprisals.

In the last year alone, 85,000 complaints were submitted to local authorities across England and Shelter found that 62% of these issues involved serious or life threatening situations. An additional 781 cases needed the involvement of local health services due to private landlord behaviour or neglect.

Shelter are urging their supporters to petition their local councils and they believe that the situation is even worse than the figures suggest.

“Despite the significant increase in complaints, we believe that the number of rogue landlords is still underestimated,” said Campbell Robb, Shelter’s Chief Executive.

“Some local authorities don’t keep records of complaints and tenants often hold back from complaining out of fear of the consequences or because they don’t believe their voices will be heard, even though such a high proportion of complaints are about life-threatening issues.”

The figures have come after a two year campaign by Shelter to highlight the growing problems with regards to rogue landlords and to encourage the government to put effective measures in place to tackle them.

In a response to these moves, the government has set up its own dedicated taskforce to tackle these problems. Under the scheme, local authorities will be given all the support they need to deal with rogue landlords and to bring about prosecutions.

In addition, £1.8m will be invested to tackle so-called ‘sheds with beds’ – slum properties that are unfit for habitation – while the plans will also remove limits on the fines that can be imposed on landlords.

Shelter may have welcomed the proposals but they insist that there is more work to be done.

“There is still much to be done,” Mr Robb continued. “It’s ultimately local authorities that must do everything in their power to support people who are suffering by cracking down on the worst offenders in their area.”

Those wishing to add their name to the charity’s campaign are invited to e-mail their local council while Shelter are urging any tenants experiencing problems with rogue landlords to get in touch with them for advice without delay.

The Lowest Burglary Rates in the UK

If you’re thinking about moving to a city in the UK, you may be interested in finding out which areas have the lowest rates of crime.

According to a survey conducted last year, the safest place to live in the UK is Eastbourne. This city was revealed to have the lowest burglary rates in the whole of the UK! Using data from insurance companies, it was proven that the BN23 postcode had the joint lowest incidences of burglaries throughout the country.

Way back in 2006, burglary statistics in Eastbourne were the worst in the whole of Sussex. Since 2007, however, burglary rates had fallen by 39%, more than double the targeted drop of 15%. This was the result of a major project commissioned by Sussex Police, working together with the Community Safety Partnership to catch and convict burglars locally. The Partnership is an organisation dedicated to improving the quality of life and the environment in problem areas.

A similar report focused around London showed that the safest areas of the city in which to live are the boroughs of Kensington, Chelsea, and Wandsworth. However, these rankings were based on other criminal factors as well as burglary, and Kensington and Chelsea rated highly even though burglary levels in those areas are actually relatively high. It just goes to show that you have to really look at data rather than just taking anything at face value!

Investigating the safety of an area before you buy property and move is essential, not only for your personal security and that of your family, but also because it can affect the amount you have to pay for comprehensive home insurance. Houses in areas where burglary is considered a high risk will cost more to insure than houses in relatively risk free areas, so take this into consideration.

You can find information about different types of insurance from companies such as Endsleigh. They offer services such as content insurance.

Buy to Let Mortgage Products Soar

Figures released by the Council of Mortgage Lenders (CML) this week reveal a huge spike in the number of Buy to Let Mortgages taken out in 2011 and although they have yet to reach the boom period of 2007, it’s clear that this is a major growth area for the mortgage industry as a whole.

The findings state that overall, the number of loans agreed leapt by 84,000 with the biggest rise appearing in the last three months of the year when 34,800 buy to let mortgages were agreed. Those figures for the final quarter of 2011 represent a significant increase from 26,300 in the same 2010 period.

By comparing these statistics with 2007, when over 93,000 loans were advanced, the rise is thereby put into some perspective but by the end of the year, this type of funding was worth around 13% of the overall market.

Paul Smee of the CML pointed to a number of factors that have contributed to the increase including a static housing market and an increase in demand for rental properties.

‘These figures do not suggest that buy-to-let is crowding out first-time buyers; more that it is performing a really important role within the overall housing market,’ Mr Smee said.

‘The benefits of the availability of good quality, private rented housing should not be overlooked, especially as there are many households which need the flexibility and mobility that the private rented sector is well-placed to provide.’

Industry experts are now predicting steady growth for an area that is something of a shining light among a depressed market. In addition, some commentators have linked the problems involved in finding first time buyer deals to the increase in buy to let mortgages.

‘The buy-to-let sector is one of the few beneficiaries of the current economic climate,’ said Jonathan Samuels of Dragonfly Property Finance.

‘Buy-to-let is being driven by the weakness of the economy and the continued caution of high street lenders at higher LTVs.

‘Consumers are wary about buying and lenders are wary about lending. The result is soaring demand for rental property, which is pushing yields ever higher’

Overall this may seem to be good news for everybody but there is a suggestion that those who are renting in the private sector may become trapped and at the mercy of greedy landlords. With first time buyer mortgages hard to obtain, rent increases may have to be endured.

Matt Hutchinson of spareroom.co.uk concluded with a warning to landlords.

‘Landlords should weigh up the benefits of retaining reliable tenants against the short-term benefits of hiking rents to take advantage of a booming rental market,’ Mr Hutchinson said.

‘The last thing any landlord wants is rental void periods, and if that means holding off imposing rent rises on current tenants, or even dropping the rent a little, then in the longer term that may be a better course of action.’

To get a free telephone consultation with an impartial mortgage advisor please complete the form below.

Invest in the Undiscovered Charm of Bequia

From the very moment you arrive in the Grenadines, you’ll know that you’re going to experience something a little bit special.  Perhaps it’s the sweet steel drum music that heralds your arrival or maybe the hospitable and generous nature of the people that help you to your holiday destination.  This and the laid back lifestyle, sensational weather, and magnificent scenery will ensure a smile is planted firmly on your face and there it will stay for the remainder of your visit.

One of the things that stays with you after a holiday in the Grenadines is the friendliness of the people.  Nothing is too much trouble and it’s hard not to make some good friends during your stay.  Whether you choose to spend your vacation diving the beautiful crystal clear waters or simply soaking up the sun, you’ll feel your worries wash away within hours of arriving.

Bequia – The Little Big Island

The Grenadines is a Caribbean chain of over 32 islands in the Windward Islands.  The largest of these islands is Bequia which forms part of the country between Saint Vincent and the Grenadines.  However, Bequia is still a tiny and exclusive island, home to fewer than six thousands inhabitants, and you too will feel at home the moment you set foot on the glistening white sand of this beautiful hideaway.

If you have dreamt of living on the perfect Caribbean island with pristine sandy beaches, an azure blue ocean, and dramatic sunsets, Bequia fulfils these needs and so many more.  Here in Bequia, there are no crowds, no traffic jams and you’ll be hailed with a warm and friendly hello wherever you go.  If you have a love of sailing, the island’s rich heritage and strong connection to the sea ensures you will always find somebody willing to share their marine knowledge and traditions so that you get the most from sailing around the Grenadines.

By day on Bequia, you can experience the real meaning of doing absolutely nothing, but those looking for adventure won’t be disappointed.  Bequia offers so many activities, from chartering your own yacht to kayaking and windsurfing.  Water sports here come into their own on this wonderful island where equipment is in plentiful supply and the waters are safe and tranquil.  Bequia also boasts many art galleries and craft boutiques where you can enjoy a relaxing afternoon browsing and perhaps investing in some wonderful souvenirs and items to take back home.

Whatever you choose to do here, you will have the time of your life.  There are no schedules or routines, and you can leave your cares and worries far behind you.  Get to know the island on land or water with relaxing coastal walks along the golden sands, or exhilarating diving, sailing or fishing trips.  If you fancy exploring one of the neighbouring islands, there is always a friendly soul to help you get there.

The warm tropical nights mean nightlife takes on a world of its own.  Sharing cocktails under the stars whilst your seafood banquet is cooked on the barbecue is pure unadulterated bliss.  And then later, you can enjoy a sun downer in one of the many beachside bars as you watch the sun gently sink behind the horizon.

Ssh, Don’t Tell Everybody…

Whilst Bequia is always going to be a popular holiday destination, more and more people are starting to think about property investment on this delightful and pristine island getaway.  Property development on Bequia has taken place on a smaller scale than other islands in the region and as a result the island retains much of its beautiful lush rainforest, dramatic waterfalls and spectacular coastline.  Imagine stepping onto your very own private beach every morning and being the only living soul for miles.  It’s all possible and with properties more affordable than on the more established islands, you might find your investment sooner than you think.

If you are searching for a slower pace of life amidst lush tropical surroundings, then Bequia island life is for you.  Whilst property prices on the Grenadines may have risen in the last three years, they still represent a real bargain when compared to comparative properties on neighbouring islands.

Invest with Confidence

Buying property in the Grenadines is very similar to buying property in the UK and therefore there should be no nasty surprises along the way.   In fact, the only challenge you may face is making a choice between the fabulous properties on offer.

Average Costs:

Buyers Legal Fees – Approximately 1% of the Purchase Price

Stamp Duty – Approximately 5% of the Purchase Price

Land Holding – License Approximately 6% of the Purchase Price

Mortgage Down Payment – Usually a minimum of 10%, but could be as low as 5%

Mortgage Repayment Period – Up to 30 years or by the time the buyer reaches the age of 65

Mortgage Interest Rate – Between 7.7% to 9%

It’s a great time to invest in property on Bequia.  Economists visiting the island have observed the island is in the early stages of a 10 year economic boom.  The Grenadines is growing in popularity every year with both tourists and those looking to secure themselves a nest egg in one of the most beautiful regions of the world.  The developing tourist industry together with a boom in international trading has helped to improve Government development policies and general welfare facilities on the Grenadines in general.

Finding the Perfect Grenadines Retreat

Properties often have their own private beach and occupy one of the most exclusive locations in the Caribbean.  One such property is this Prime Front Line Villa, currently on sale, and located between two of the most voted for beaches in the world.

If you are looking to invest in the Grenadines, this property offers an impeccable example of the style of property you can hope to make your own.  Featuring signature wooden floors, high wood ceilings, and immaculate fittings this property commands stunning ocean and mountain views.

Take the First Step

If you would like to find out more you can get expert advice on investing in property in the Grenadines and details of available properties from Grenadine Escape Ltd.  Contact Lara Cowan on +44 203 468 5592 or Lucille Cozier on +784 496 0654 for more details about this fabulous opportunity.

Debt in the UK – Perception Versus Reality

You can’t open a newspaper these days without reading articles about debt and how the UK is drowning in it.  Of course dramatised stories and over-egged reports sell newspapers, but what do the general public think?  What is the perception of UK debt versus reality?  It’s true that many people are struggling with debt and it’s fair to say the reccession has been the catalyst of many a personal debt problem.

In the UK we are quite secretive about our debt.  It’s one of those taboo subjects that never really comes up.  It’s considered crass to wave a platinum credit card around these days and we tend to keep any debt problems to ourselves or at least within our own four walls.  Perhaps if we were more open about debt and debt problems we could find a way to get help more easily.

A recent survey conducted by Payplan asked a section of the UK public seven questions about their perceptions of debt.  The short survey was designed to explore our thoughts about gender, marital status, housing status, total amount of unsecured debt, monthly income, the regions where debt is more prevalent, and how long it would take to pay back their debt.

Let’s take a look at those questions and the results.  In some areas the perception is pretty close to reality, but in others it’s way off!

For example, a large percentage of those questioned thought that renters were most likely to have debt problems when the reality is it was the homeowners that came out on top.  Of course, homeowners usually have more secured debt in the form of mortgages, but the survey was focusing on unsecured debt and particular debt problems.

Another question asked how many years it would take to pay off a debt management plan to clear a debt.  21% thought it would take 13 years whilst 18% thought it would take 5 years.  The reality is 9 years for most people.

Marital status was also an interesting question.  A lot of those surveyed believed divorced or separated people to be most likely to have a debt problem when it was in fact singletons who came out top.

The infographic below shows perception vs reality in clear detail.  It’s interesting to see how much of the UK is affected by debt and it’s clear to see that our perception is a lot different to what is actually happening out there.

Of course, it goes without saying that you should only take on debt if you can afford the repayments.  Debts like mortgages and personal loans will usually take years to pay off so know what you are getting into before you sign on the dotted line.

Source: Payplan – IVA and Free Debt Management Plan provider.