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Archive for January, 2010

London Property Review Of The Year 08

2008 was a rollercoaster of a year for the UK’s property market. SecureASale Director Tim Jackson looks back on the ups and downs of London’s housing sector over the past year
2008 started slowly with the hangover for the manic record market of 07. By the end of 2008 the UK was in the worst housing slump since the 1930s. There are three main factors that have contributed to this heady downward spiral.

1 / Cyclical economic slowdown

After 15 years of nonstop growth the UK economy had overheated and house price inflation had faroutpaced rises in average earnings. The average home was costing 7 times average earnings which was unsustainable. A policy of low interest rates had led to the availability of cheap credit and properties had seemed affordable despite the everincreasing prices. However nervous of inflation running rampant the Bank of England MPC gradually raised interest rates up to 5.75 in July 2007. This hit highlyleveraged borrowers hard especially those on interest only mortgages and had the desired effect of substantially cooling the housing market.

2 / Worldwide banking crisis

When Northern Rock collapsed in the summer of 2007 it wasnt a oneoff event but was linked to the fallout from the subprime market both here and in the United States. Banks worldwide had gambled by lending to uncreditworthy customers who were left unable to afford their loans and therefore defaulted on them often literally handing back their keys to the lender. As Northern Rock had grown its business by taking on risky debt it soon found itself unable to secure funding to operate and the government had no choice but to bail it out. The banks then all took note of this and substantially tightened their lending criteria. In a matter of weeks the days of 100 mortgages were gone and loan to value ratios were cut dramatically.

3 / Lending halt

This alone would be enough to cause a housing crash but on top of this the banks stopped lending to each other almost completely. This credit crunch affected the entire economy from small businesses to the largest industrials and we are now seeing the rising unemployment and reduced spending that a shrinking economy causes.

The result of this unhappy alliance of bleak news is that buyers couldnt borrow money to fund their moves vendors couldnt afford to take lower offers on their homes as that often dragged them into negative equity and thousands of builders estate agents and mortgage advisors went bust as business dried up.

The lettings market has been hit too as thousands of homeowners unable to Sell House Quickly but needing to move have found themselves having to let their properties out in effect becoming reluctant landlords and massively increasing supply. The result of this is that cash for houses have been dragged down in the rental sector and many buy to let investors are finding that their rents no longer cover their costs and their investments are repossessed by the bank further damaging the market.

Is there a way out of this crisis?

The only route back to stability is for the banks to begin normal lending again both to each other and to homebuyers. Without this the market is in for an even worse 2009. Only time will tell.

About the writer:  This article was written by SecureASale Director Tim Jackson. To learn more about Tim and SecureASales services visit http://www.secureasale.co.uk.

Practical Ways To Manage Your Debt

There are a number of practical ways to reduce debt and some of these you have probably heard before. Once you have sorted out your debt problems then in future avoid debt traps and keep a tight rein on your finances. Taking some time to analyze your current financial circumstances is a strong beginning and once you know exactly what the position is then you need to share the information with your family. This way no one will have a false impression of how things really are. You probably are facing debt challenges if:

1. You owe more money than you own in assets.

2. You spend more than what you earn every month.

3. More than 50 percent of your total income goes towards servicing your debt.

4. More than 25 percent of your income is spent paying just interest on your debts.

5. More than one of your bills is two or three months in arrears.

6. You have to decide which debt you are going to pay each month.

7. You have been requested to return one of your credit cards or store cards.

8. Your bank account has been closed because of returned debit orders.

9. You fear answering the phone because it is more than likely a debt collector calling.

Follow these helpful hints

Add up all the expenses and debt on your list and compare the sum to your monthly income. If you and your partner are working together do it together and work out a joint plan of action.

Prioritize decide what you consider are essentials you really can not do without and what are really extra s that can be cut back on. Assess each debt total interest payable its terms of repayment the length you have to still pay on it and the monthly interest you are paying.

If possible consolidate your debt. Use mortgage equity if you have or go for one big loan. When you do then you will be able to pay off smaller debts in one go. Managing your finances will become a lot easier because this will result in the bank or your mortgage being your only creditor. Close the accounts and tear up credit and store cards as you pay them off so that the temptation to use them is gone.

Arrange to speak to your creditors; those to who you owe money. In the majority of instances they will be more understanding if they see you have a plan and are prepared to make sacrifices. After all they want their money back

Avoid any investments while you have a high debt as the interest you pay on your debt is likely to be higher than any returns you will receive on an investment.

Consider a parttime job or look for means of earning extra money where possible. This will certainly boost additional cashflow. Use cash instead of credit and be price conscious. A few cents here and there makes a huge difference when it all adds up! Do not be afraid to ask for professional assistance if you are having trouble coping on your own.

Getting yourself and your family out of debt is not an insurmountable challenge. The solution begins with discipline and an attitude adjustment. Be more respectful of your future earnings. Debt is spending future earnings after all. Who really wants to live under that forever?

More Debt Advice

About the writer:nbsp;nbsp; Sensible Debt Advice
Richard has been researching the internet for quality work from home programs and business Opportunities to keep people informed and able to avoid scams since early 2003. You can use this honest advice and choose your home based business with confidence.

Owens Seven Savvy Secrets To Saving Money

1. Have a review of your outgoings
Check your bank statement for unnecessary direct debits. You may have set something up when you were feeling flush or felt pressured to sign up for some benefit that you have seen no sign of. Cancel anything that you dont need or see a benefit from this doesnt apply to all insurance policies! Ensure you have adequate cover for your assets but dont waste money on the unnecessary.

2. Review daytoday spending
You could make significant savings by adjusting your spending habits slightly taking a packed lunch instead of buying a sandwich every day will reduce your outgoings each month and buying supermarkets own versions of the classic Indian and Chinese takeaways on a Saturday night demonstrate much better value than calling your local delivery service.

3. Protect your credit rating
Banks and building societies are becoming more selective about who they will lend to. That means you need to make sure your credit rating is as good as it can be in order to maximise your chances of having a credit application accepted. Dont make unnecessary loan applications as repeated rejections will be listed ensure that you pay bills on time to avoid both late charges and being listed as a bad payer and dont borrow money as a quickfix. For 2 you can view your credit record so that you know your position. Visit www.experian.co.uk

4. Shop around for different energy suppliers
Its staggering but more than 60 of people have never shopped around for a different energy provider. Its quick and its simple nowadays and people could cut their bills by around 250 a year Even higher in some cases. We all know how the utilitiy companies have been putting up their charges recently so its more important for ever to be switched on to this. Complacency can literally carry a high price.

5. Reduce energy consumption
As well as switching to a cheaper tariff be mindful of wasting energy and paying the price. Simple steps such as turning televisions and computers off rather than leaving them on standby using energy efficient light bulbs and doing your washing at 30 degrees instead of 40 degrees could reduce your energy costs further.

6. Drive your fuel cost down
Petrol and diesel costs have been a huge hot potato in recent months so any opportunity to reduce them should be grabbed with both hands. Check your tyre pressure underinflated tyres force your car to work harder and use more fuel. Remove excess clutter from your car the heavier the load the more fuel you burn so dont lug bags and boxes around if you dont need them. Curb your inner boyracer revving your car like a Formula 1 car wastes fuel the only place youll get to faster is the fuel pumps.

7. Compare insurance quotes
The vast majority of consumers renew their home or motor insurance with the same provider year after year. Insurance is a massively competitive industry now; so take the time to do your research. Be sure that the policies youre comparing include all of the benefits you want from your insurer before you opt for the cheapest. Cheapest is not necessarily the best for you and if you pay the price in excesses or courtesy car costs your bargain deal will turn out to be a false economy in the event of an accident.

To see more financial advice visit http://www.askowen.co.uk

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