UK lenders pause new mortgages amid market turmoil

Some of the UK’s biggest mortgage lenders, including Virgin Money and Skipton Building Society, have stopped offering new home loans in response to the market volatility triggered by the government’s mini-Budget.

Halifax, part of Lloyds Banking Group, the biggest mortgage lender in the UK, is also withdrawing a range of new home loans, it told brokers.

The pause in new lending comes after yields on UK bonds rose sharply following the tax cuts announced on Friday by chancellor Kwasi Kwarteng.

“This is the first time we’ve seen a major withdrawal of products and repricing in the mainstream market since the global financial crisis,” said Ray Boulger, an analyst at mortgage broker John Charcol.

“The huge rise in gilt yields means lenders have to reprice mortgages very significantly. I expect by next week there will be very few mortgage deals available with rates under 5 per cent. Any lender who hasn’t

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Housing inflation is dead | Financial Times

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Good morning. It’s CPI day. There is good reason for optimism that inflation will continue to abate, and not just because of gas prices. But as we like to repeat at Unhedged, there is no such thing as high and stable inflation. There will be more surprises, in both directions, before the current episode concludes. Email me: [email protected]

Housing: even worse (so, better?)

The last time Unhedged checked in on the US housing market, back in June, we wrote that “housing remains the one big area of the economy that is not sending mixed signals. It just looks bad.” This is no longer true: the US housing market no longer just looks bad; now it is very bad.

“Bad” is ambiguous in this context, though. Sharp

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Evergrande vows to restart all stalled property projects

China Evergrande has pledged to resume construction of all remaining stalled property projects by the end of this month, as the world’s most indebted developer works to pacify a nationwide mortgage boycott.

The developer will resume the construction of 38 remaining projects by the end of September and accelerate 62 restarted projects to “normal level”, according to a company statement released late on Monday that cited its chair, Hui Ka Yan, in a weekly meeting.

Among Evergrande’s 706 pre-sold projects nationwide that need to be completed and delivered to homebuyers, 668 had resumed construction, it said.

“We have to work hard and put our nose to the grindstone to ensure the delivery of projects. Only in this way can we satisfy the homebuyers, resume sales, resume operations, repay all types of debts and get out of the predicament,” Hui said at the meeting.

Evergrande has been at the centre of

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UK stamp duty cut unlikely to help first-time homebuyers,

A stamp duty cut announced by the UK government on Friday risks pushing up house prices and will do little to help first-time buyers on to the property ladder, according to housing experts.

Chancellor Kwasi Kwarteng laid out plans to cut the property transaction tax as part of his growth-focused fiscal package on Friday. The move is designed to give a leg up to first-time buyers and support an increasingly fragile housing market.

The cut, which could save some buyers more than £10,000, would “support growth, increase confidence and help families aspiring to own their own home”, said Kwarteng.

Effective immediately, buyers in England and Northern Ireland will pay no stamp duty on the first £250,000 of a property’s value — double the previous £125,000 threshold — and first-time buyers will pay no tax on the first £425,000, up from £300,000.

First-time buyers in London and the south-east could potentially

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Should I buy a home on my own before we get married?

My fiancé and I have been toying with the idea of buying a home for a while. He has a flat that he owns and rents out as he is in the armed forces, so is away a lot. I was going to purchase somewhere on my own but his parents have gifted us some money as a wedding present which we would like to add to the budget I have.

As a first-time buyer, I would like to benefit from the stamp duty reduction. Similarly, since his parents are gifting the money, what are his rights towards the property ownership in the event of divorce or my death? Could I add his name to the deeds but keep the mortgage in my name?

Headshot of Helen Marsh, partner at Forsters
Helen Marsh, a partner at Forsters

Helen Marsh, a partner at law firm Forsters, says this is a complex question. There are two main issues

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Why New Homes Need Landscape Lighting

People love to show off their new homes when they purchase them. It’s easy to see homes as beautiful during the day. But what happens when it gets dark? You must consider the exterior of your home when you are building or renovating it. Here are 6 reasons why 39% of homeowners and potential buyers believe landscape lighting is essential.

1. Quality Commitment

Only 10% of homeowners/prospective buyers will accept the use of lower-quality materials to make the home more affordable. This means that 90% of potential buyers will pay more to get better quality. The quality of a home should not end after it is built. People get so involved in the interior that they forget to consider the exterior. While not everyone will see your home’s interior, anyone who drives by your house gets to see it from the outside. Landscape lighting is a great way to personalize … Read More

Discount sale of Deutsche Bank London HQ highlights market

Deutsche Bank’s new London headquarters is being sold after having its price cut significantly, a disposal that lays bare the impact rising rates have had on commercial property prices.

Lendlease, the Australian developer which previously redeveloped the capital’s Elephant and Castle neighbourhood, has struck an agreement with UK landlord Landsec to buy 21 Moorfields, Deutsche’s City of London base, for £809mn. 

The deal displays the chilling impact of rate rises and an expected recession on the market. Landsec was originally hoping to raise closer to £1bn from a sale, according to office agents in the capital, and 21 Moorfields was valued at almost £900mn as recently as March this year.

Since then, rising rates and inflation have added to the costs facing investors and developers and seen the market seize up.

“It’s a large-scale deal [but] 12 months ago [21 Moorfields] would have been a lot pricier, let’s put it

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China Vanke spin-off seeks $780mn in Hong Kong’s biggest IPO

China Vanke plans to raise up to $784mn in Hong Kong from the spin-off of its property management unit, which is set to test global investor appetite for real estate-related listings after a string of high-profile defaults in the sector this year.

Onewo, a subsidiary of Vanke, said it would raise up to HK$6.2bn ($784mn) from an initial public offering of about 117mn shares priced at a range of HK$47.10 to HK$52.70 each, according to a filing with the Hong Kong exchange.

The decision to list Onewo comes as Chinese authorities step up measures to support the country’s beleaguered property sector, which accounts for about a third of total economic output, as growth in the world’s second-largest economy slows.

Demand for housing in China has crumbled after a series of defaults by developers stoked a crisis of confidence among homebuyers. Last week, state banks cut deposit rates for the first

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Singapore hotels: Reits outperform as parties return

Normally quiet Singapore hopes to become one big party island soon with the arrival of global pop groups including Green Day. After a two-year break due to pandemic restrictions, Formula 1 returns along with several global investment conferences. Hotel operators should have a good time too.

Accommodation prices in Singapore have hit their highest in a decade. Average hotel occupancy rates approach 80 per cent, just shy of pre-pandemic levels. After Covid-19 struck, Asia’s average hotel occupancy fell to as low as 25 per cent in 2020. Shares of Asian hotel and resort operators, including Genting Singapore and Shangri-La Asia, have gained in the past year as Singapore eased border restrictions.

This is good news for the real estate investment trusts (Reits) sector. After a poor five years, Singapore-listed hospitality Reits including Far East Hospitality Trust and CDL Hospitality Trusts, have rebounded in 2022. Another, Frasers Hospitality Trust, received bid

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US home mortgage rates top 6% for first time since 2008

Average US mortgage rates have topped 6 per cent for the first time since the 2008 financial crisis, showing how the Federal Reserve’s aggressive policy of monetary tightening is ratcheting up the cost of financing the purchase of a home.

The average 30-year fixed-rate mortgage rose to 6.02 per cent, up from 5.89 per cent a week ago and 2.86 per cent in the same week last year, according to Freddie Mac’s weekly survey. The borrowing benchmark has nearly doubled since January in the steepest and fastest increase in interest rate in more than 50 years.

The rapid rises in mortgage rates track with the Fed’s campaign to lift its own benchmark interest rate in a drive to damp surging US inflation. Futures markets predict the central bank will raise the rate by 0.75 percentage points for the third consecutive time when it meets next week.

Higher interest rates are

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