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Debating the new homes problem

The UK is desperately short of homes but new-builds are dogged by cautious LTVs and inconsistent valuations. Our round table discussion tries to get to the bottom of these issues and find ways to kick-start the sector

Standing from left: Paul Howard, head of intermediaries, Nationwide; Iain Laing, chief risk officer, Nationwide; John Wakefield, manager, New Home Mortgage Services; Nigel Stockton, financial services director, Countrywide; Ian Andrew, head of intermediary sales, Nationwide; Paul Woodward, partner, Derngate Associates; John Cupis, managing director, Sesame Bankhall; David Thornton, divisional chief executive, Persimmon Homes; Adrian MacDiarmid, head of mortgage lender relations, Barratt Developments;

Seated: Andy Frankish, commercial director, Mortgage Talk; Alison Beech, head, Valunation



Time to ditch the jargon

American author Mark Twain has been credited with saying “I wanted to write you a short letter but I didn’t have the time”.



Swaps reacted to the MPC minutes with a sharp fall and it seems we could be seeing QE2 in the near future. It’s a shame Kensington withdrew
its high LTV deals, but well done to Halifax for extending its core range

What triggers the MPAA?

Jim Grant – Senior Product Insight & Technical Support Analyst There’s sometimes confusion around what triggers the money purchase annual allowance. Find out what does and what doesn’t trigger the MPAA. The money purchase annual allowance (MPAA) is a reduced annual allowance that can apply to contributions to defined contribution (DC) schemes. The following table […]


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  • Mark C 7th October 2011 at 3:18 pm

    New Build Premium is a fantasy, as soon as a house is sold it dissappears therefore is of no value to a lender.Previously hidden by rampant inflation , no longer valid in todays marketplace.
    Builders should price correctly for size and location, and ensure they do not overpay for their sites.
    Valuers have no part in this discussion, they are in existence to protect the buyer and lender, not feed the price frenzy builders would like to see happen again.
    And will somebody tell me how many brokers have lost clients because they cant buy new. Does a first time buyer happily stay with Mum and Dad or rent rather than buy one of the thousands of used homes on the market.

  • jonny michaels 6th October 2011 at 9:24 am

    David – There was a broker involved – New Homes Mortgage Services.

  • Steven Firth 3rd October 2011 at 11:58 am

    The shared ownership scheme is simply storing up problems for the future. Essentially, builders are charging a premium on self build compared to a cash purchase. Valuers need to remember they are there to protect the lender and to some extent, the purchased, not simply to agree to builder’s asking price.

    There is a massive housing stock in this country which is available for purchase at reasonable prices. the more new homes taht are built simply makes the existing stock more difficult to sell and guarantees negative equity for new build purchasers.

    The problem is that the housing stock is not in the areas where jobs are being created. Rather than build over the entire south east, let market forces come into play and businesses will move to more viable areas where housing is more affordable.

    The Government could play a major role in tis by say “encouraging” the relocation of Heathrow to Birmingham. That would be a true signal if intent to come to terms with our national economic situation.

  • David Jones 3rd October 2011 at 11:50 am

    Why were no actual brokers who currently write business invited to this debate? We are the one’s who work at the coal face and have to try and deal with the problems that exist within this area of the mortgage market.

    If you’re going to have a proper debate then make sure all interested parties are fairly represented.

    The current problems are nothing new as they were similar during the crash of the early 90’s.

    Nationwide haven’t wanted to lend on New Build at the higher loan to values and that’s fine.

    To make the comment ‘Down-valuations don’t seem to be a big issue as far as we’re concerned.’ is because brokers avoid using you as you value based on being ‘second hand’.

    I’ll predict that for 2012 Nationwide take a different stance on New Build as they’ll want a bigger slice of the market.

  • Maurice Edgington 30th September 2011 at 6:51 pm

    Forget the past a radical review of lender’s attitudes to new build is needed. Valuers should not call themselves valuation experts if they cannot value a new build property and in any event down valuation is not the reason for the loan to value issue. Lenders panic caused the loan to value issue just as panic causes massive changes in the stock market. I would suggest senior figures at lenders meet senior figures in housebuilding, go out on site, see what they would be lending on compared to the rubbish they lend on in the second hand sector.

  • Peter Ireland 30th September 2011 at 4:16 pm

    I take issue with Nigel Stockton’s view that there will be a shortage of stock there are dozens of stock plots unsold. Why else would he be trying this nonsensical high LTV for low LTV swap which is hardly TCF for the low LTV client. New build is paying the price for all the discounts dressed up as deposits.