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MS Leader: The right building blocks?

The market continues to look healthy, with the Bank of England’s latest money and credit report the number of loan approvals for house purchase in July this year was 60,624, a 30 per cent increase on the 46,665 approvals in July last year.

Obviously if this just creates another property bubble in hot spot areas in the South East and London, then in the long run be no good to anyone.

Rather than another boost in house prices what the UK desperately needs is a construction boom.

While there has been a small pick-up in housebuilding figures it is from chronically low levels and much more needs to be done to increase supply.

Little wonder then that think tank the Adam Smith Institute called for the Government to scrap its Help to Buy scheme and instead focus on ideas to improve supply such as abolishing affordable housing quotas and releasing more farmland for development.

However if higher equity levels have helped to improve home affordability for so called second steppers – the terms Lloyds Banking Group has come up with to describe homeowners currently living in their first home but looking to take the next step up the property ladder – then that good news at least.

A key cap on mortgage intermediaries’ income in general over the last couple of years has been an inability for some borrowers to do anything, be it remortgaging or purchasing an even bigger property.

Another cap is obviously the amount lenders are willing to pay them. Countrywide Group’s Nigel Stockton makes a compelling case in his column on page 27 this week as to why proc fees should go up.

Whether the lenders will listen, especially with the additional costs from the Mortgage Market Review, is another question.



Lean times leave a leaner, keener core

August 9 2013 marked the six year anniversary of the start of the current financial crisis. On that day back in 2007, alarmed by banks reluctance to lend to each other, the ECB and the US Federal Reserve injected $90bn into financial markets. That day the FTSE lost 121 points and the US Dow Jones […]

FCA guidance on interest-only debt

The Financial Conduct Authority last week issued guidance to lenders and third-party administrators about how to treat interest-only customers who risk being unable to repay their loan. In May, the regulator launched a consultation in which it sought views on how to deal with these borrowers. The FCA says firms should have a written strategy in […]


60 Seconds with… David Shortt, principal, Oliver Rae

Your new company Oliver Rae is aimed at helping businesses and buy-to-let landlords get tax relief on property purchases – how does it work? Capital allowances are an integral part of tax law. They allow businesses to get tax relief on large purchases in recognition for the fact that assets appreciate in value. Most companies […]

Three catalysts for European equities

By Rob Burnett, Manager of the Neptune European Opportunities Fund In recent weeks, the bear case for European equities has become more pronounced on the back of weaker-than-expected GDP data and deflation concerns. This softening in economic momentum has led some investors to question whether the ECB is behind the curve and indeed whether it […]


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