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Home-buying in 2017

Home-buying in 2017

Buying a new home can feel like a rollercoaster ride, with plenty of highs but also a few lows.

Almost a year on from the EU referendum, and with a General Election on the immediate horizon, how confident is the UK’s housing market – and what does it mean for home buyers?

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How confident is the housing market?

March 2017 saw 48,178 loans approved for house purchase, according to the British Bankers Association (BBA), no change year-on-year, while the average approved loan rose to £186,800. House prices fell by 0.4% in April 2017, though were up 2.6% on a year ago.

However, the same month, consumer confidence in the housing market dipped to 37%, the lowest since July 2013, after widespread prediction of a surge in inflation and a fall in consumer spending this year.

This comes even as overall consumer confidence remained on the up, with a sixth consecutive month of spending increases.

What do the experts predict for the UK housing market?

Some experts suggest that a time of such economic uncertainty is bound to have an impact on the housing market.

Zoopla CEO Alex Chesterman is cautious about seeing growth in the property market in 2017, and said: “Buying a home is one of the biggest and longest term decisions that people make so they tend to hold off making such important decisions in times of heightened uncertainty.”

According to John Perry, of 2017 UK Housing Review,  more houses need to be built regardless of any changes in immigration policy after Brexit – the current target, set before the referendum, is 227,000 homes a year up to 2024. He also suggests that most non-British EU citizens tend to rent in the private sector, so that it is the area that is most likely to be hit.

It’s arguable that the fewer houses being built, the more the chance that those in-demand properties will be more expensive, especially for first-time buyers.

Nationwide’s chief economist Robert Gardner agreed that uncertainty makes it hard to predict the prospects for house prices, but added: “Low interest rates are expected to help underpin demand while a shortage of homes on the market will continue to provide support for house prices.

Will house prices go up or down?

Uncertainty about the next 12 months, and the effects on the economy, could cause the market to slow down as buyers and sellers mull over what to do next.

The economy is the major factor on the housing market, so if the pound continues to struggle in 2017, it may affect house prices negatively but if things start to improve, house prices could rise.

Investing in property to make a profit – rather than just to have a long-term place to live –  is always a risk. So, it’s important to make sure that you don’t borrow more than you can afford, and try to find the right mortgage with the best rate.

What to do before applying for a mortgage

Whether you’re planning on buying your first home, stepping up to a bigger home or remortgaging, Experian’s tips can help you feel financially prepared & confident ahead of your mortgage application.

  • Check your Experian Credit Score to help you understand how lenders may view you
  • Try not to miss credit payments
  • Try not to apply for other credit in the six months before you apply for your mortgage
  • Manage credit accounts well
  • Register to vote at your current address

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†Experian acts as a credit broker and not a lender in the provision of its credit cards and personal, car finance and guarantor loans matching services, meaning it will show you products offered by lenders and other brokers.

Experian acts independently and although CreditMatcher shows products for a range of lenders and other brokers it does not cover the whole of the market, meaning other products may be available to you. CreditMatcher services are provided free however we will receive commission payments from lenders or brokers we introduce you to. For information about the commission we receive from brokers for mortgages and secured loans click here.

CreditMatcher is provided by Experian Ltd (Registered number 653331). Experian Ltd is authorised and regulated by the Financial Conduct Authority (firm reference number 738097). Experian Ltd is registered in England and Wales with registered office at The Sir John Peace Building, Experian Way, NG2 Business Park, Nottingham, NG80 1ZZ.

Copyright © 2017, Experian Ltd. All rights reserved.

A guide to remortgaging

Remortgaging is on the up! It now accounts for about a third of all home loans.

When you remortgage, you take out a new loan with either your existing lender or another lender. According to the Council of Mortgage Lenders (CML), there were 34,700 loans for remortgage in December 2016, worth a total £5.8bn – that’s an increase of 13% in volume and 14% in value – while Paragon reported they now account for 39% of all mortgages handled by advisers.

Remortgaging could help you free up money for something you really want, help you pay your mortgage off quicker by moving to a lower rate, or help you better manage your monthly household outgoings. TSB found that homeowners could save an average of £96 a month by remortgaging to a lower fixed rate deal.

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7 tips for moving in to your new home

You’ve sealed the deal, inked the contract and are about to move into your new home at last. But before you take a breather, there’s still plenty to do – some of it is the fun part (furnishings) and some of it is necessary administration tasks. Each of those can be done in a finance-friendly way though.

Here are our top tips for moving in to your new home, and how you could make the most of your finances.

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How to make mortgage lenders love you

How to get a mortgage

One of the first steps to getting a mortgage is to impress the lender with your credibility. So here are a few simple steps to financially prepare yourself to help you get the mortgage you want.

In 2014 the Financial Policy Committee (FPC) said that only 15% of all new mortgage lending offered by banks and building societies could be more than 4.5 times a person’s income. Currently, mortgages of more than 4.5 times the borrower’s income is around 10% of lending.

So, if you want to be in the 15% of high loan-to-income applications, you’ll probably need to have:

  • A good deposit
  • A steady income
  • Little debt
  • A good credit score

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Home improvement: can it pay off?

Is improving your home worth it

We’re a nation of DIY lovers, aren’t we? Home improvement can be a double winner, as not only can it make your house into a home, it could also make it a more profitable asset for you.

And a lot of us think that now. An amazing 91% of homeowners think their house value has increased since they bought it, and by an average of £33,125, according to recent research from Co-op Insurance.

The research also showed that homeowners believe that renovation and decorative works they’ve carried out has led to an average £14,900 increase in property value.

But doing your homework before starting, working out exactly how you’re going to pay for the improvements, is important too.

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7 tips for first time home buyers

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Buying your first home can seem at times like climbing a particularly steep hill - daunting, confusing and with several pitfalls along the way.  Prices are still rising, with the average UK first-time buyer home now costing £184,973, 7% up on that of a year ago1.

And finding the money for a deposit without help from the Bank Of Mum And Dad can be a real challenge – the typical first-time buyer deposit is now £33,222 - that’s 133% of an average salary1. The average first-time buyer borrowed 3.49 times their income, and the average first-time buyer loan was an estimated £136,0001.

But with a few simple steps to prepare yourself financially, and make lenders see you in a positive light, you could approach buying your first home with a lot more confidence.

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Garden Cities set to make a comeback

Garden cities coming backIn 1898 Sir Ebenezer Howard published his book “Garden Cities Of Tomorrow”, which set out his (at the time outlandish) ideas that new cities should be planned, self-contained communities surrounded by what would soon become known as green belts.

And almost 100 years after the last garden city was established, plans set to be revealed in Wednesday’s budget have included the launch of a brand new one in Ebbsfleet, in Kent.

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An Olympian place to buy a home

Starter's orders - for a starter home

Starter’s orders – for a starter home

What are your memories of London 2012? For many of the athletes who weren’t good enough or lucky enough to win medals, it could be the time they spent living shoulder-to-shoulder with their fellow competitors in the Olympic village close to the stadium in Stratford. Yet some new homebuyers can now walk up the same steps, use the same bathrooms and look out over the same balconies as 2012’s heroes.

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