Wake-up call

Posted: May 3, 2013 | Author: | Filed under: Housing market, Mortgages | Leave a comment

The interest-only mortgage is the housing scandal that just keeps coming back.

In the 1980s it was all about the mis-selling of endowment mortgages. In the 2000s it was about selling as many mortgages as possible without caring too much about whether there was a way to repay them. In the 2010s and 2020s it will be about dealing with the consequences – and who pays for them.

Read the rest of this post on Inside Edge, my blog for Inside Housing

Beyond help

Posted: April 21, 2013 | Author: | Filed under: Budget, Housing market, Mortgages | Leave a comment

It’s hard to remember a more damning select committee report than the one just published on Help to Buy – and it has not even started yet.

You don’t even have to read between the lines of the Treasury committee report on the Budget to detect its doubts about a policy announced by chancellor George Osborne last month. It leaves him with a string of questions about how it will work and a list of concerns about unintended consequences.

Read the rest of this post on Inside Edge, my blog for Inside Housing

Dynamic duo

Posted: March 6, 2013 | Author: | Filed under: Housebuilding, Housing market, Mortgages, Private renting | Leave a comment

So will the next big housing announcement from David Cameron and Nick Clegg amount to any more than the last three?

The Financial Times reported yesterday that the coalition double act are ‘drawing up schemes to revive the flatlining housebuilding industry and help people get on the housing ladder’. On the eve of the Budget on March 20 they will make a series of announcements including measures on shared equity schemes, social housing and support for first-time buyers.

Despite the scoop, even the FT admits that this ‘may be treated with some scepticism given that such announcements on housebuilding have become a regular feature of the coalition – while the industry has continued to stagnate’.

Read the rest of this post on Inside Edge, my blog for Inside Housing

One-way street

Posted: February 14, 2013 | Author: | Filed under: Housing market, Mortgages, Private renting | Leave a comment

Repossessions are at their lowest and loans to first-time buyers are at their highest since 2007. Has the housing market finally turned the corner?

That’s certainly one interpretation of stats released by the Council of Mortgage Lenders (CML) this week showing big improvements since the year the credit crunch hit.

On Tuesday it revealed that 216,200 first-time buyers became homeowners in 2012. That was a 12 per cent rise on 2011 and it’s the first time since 2007 that the annual total has exceeded 200,000.

Read the rest of this post on Inside Edge, my blog for Inside Housing

A nation divided by housing tenure

Posted: December 14, 2012 | Author: | Filed under: Buy to let, Housing market, Mortgages, Private renting, Social housing | Tags: | Leave a comment

This week’s Census reveals a historic shift from owning to renting as the nation adjusts to new housing realities. That much is obvious but there are some significant trends behind that headline number too.

The results for England and Wales show private renting has risen from 9 per cent of households in 2001 to 15 per cent in 2011 and that home ownership has fallen from 68 per cent to 64 per cent over the same period.

However, that simple two-way split misses what has happened beneath the surface. Tenure is now split roughly three ways between outright ownership, owning with a mortgage and renting (itself split evenly between social and private renting). Many people were watching to see whether private renting would overtake social renting (for the first time since 1961) but this did not happen unless you include all forms of private renting, including those who rent from an employer or live rent-free.

So the more significant change for me is the fact that there are now more renters (private and social) than people buying with a mortgage. Between 2001 and 2011, mortgaged home ownership fell from 39 per cent of all tenure to 33 per cent. The total number of households buying with a mortgage has fallen by 749,000 over the last ten years from 8.4 million to 7.6 million. However, if mortgaged ownership had maintained its 2001 share of a rising number of households, there would now be 1.4 million more home owners on the housing ladder.

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The Spanish mortgage crisis as an Almodóvar film

Posted: November 13, 2012 | Author: | Filed under: Homelessness, Mortgages | Leave a comment

I’ve just been reading about the horrific suicide of a 53-year-old woman in the Bilbao suburb of Barakaldo, who jumped to her death from her fourth floor flat as court officials arrived to evict her.

As UK newspapers are reporting this morning (see FT and Guardian), this is the second repossession-related suicide in Spain in the last two weeks. Prime minister Mariano Ragoy has pledged to support struggling families but is under attack from the opposition for rescuing the banks while imposing austerity on the people. The Association of Spanish Banks has said it will call for a freeze on evictions of ‘vulnerable homeowners’ for two years.

This piece about evictions by the Spanish film director Pedro Almodóvar appears on the Spanish and French websites of the Huffington Post – but not so far on the UK site. Here is my rough translation of what begins as though we are seeing scenes from a film that juxtaposes what happened in Bilbao with what I think is the memorial service in Madrid for four teenagers killed in a stampede at a party at the Madrid Arena on November 1. That is followed by the first part of Almodóvar’s main piece.

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Squeezed out

Posted: October 31, 2012 | Author: | Filed under: Economics, Labour market, Mortgages, Private renting, Social housing | Leave a comment

Housing is the big thing missing from today’s major report on living standards from the Resolution Foundation.

The final report of its Commission on Living Standards looks at the plight of low and middle income families. Things were bad even before the crash with average incomes falling by £570 between 2003 and 2008 as growing inequality meant that prosperity was not shared around. The gap was only made up by a £730 a year increase in tax credits.

Read the rest of this post on Inside Edge, my blog for Inside Housing

Barbed wire

Posted: October 25, 2012 | Author: | Filed under: Housing market, Mortgages | Leave a comment

Is it possible to ‘hard-wire common sense’ into a mortgage market that has a track record of irrational excess?

The Financial Services Authority (FSA) launched the final version of its Mortgage Market Review (MMR) this morning after a marathon round of consultation with lenders and consumer groups.

Read the rest of this post at Inside Edge, my blog for Inside Housing

Our dysfunctional housing market

Posted: August 27, 2012 | Author: | Filed under: Housing market, Mortgages, Private renting | 5 Comments

Anyone wondering why the housing market is so dysfunctional can find plenty of explanations in figures released over the last few days.

Exhibit one: the Bank of England’s account of the effect its £375 billion (so far) quantitative easing programme. Most of the publicity has gone to the revelation that the richest 5 per cent of the population have gained 40 per cent of the benefits as the result of the way it has inflated the prices of assets like shares. However, it also includes an estimate of the way that borrowers have benefitted at the expense of savers because of record low interest rates. The total impact of lower rates on secured lending (mostly mortgages) is estimated at £94.4 billion since September 2008.

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Rise and fall

Posted: August 10, 2012 | Author: | Filed under: Housing market, Mortgages, Private renting | Leave a comment

Behind the good news story of falling mortgage repossessions a different tale is starting to emerge of rising possession actions against tenants.

Figures published by the Council of Mortgage Lenders (CML) yesterday showed that its members repossessed 8,500 homes in the three months to June. That was the lowest quarterly total since the final quarter of 2010 and implies that the total for the year is likely to undershoot the CML’s forecast of 45,000.

Read the rest of this post at Inside Edge, my blog for Inside Housing

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