Oliver Adair MAB

How does the Bank of England’s mortgage lending cap affect you?

In an attempt to try and ‘cool down’ the housing market and its buoyancy, the Bank of England (BOE) and its governor Mark Carney have recently revealed that caps will be imposed on mortgage lending.

Under the new rules, lenders will now not be allowed to lend amounts that are 4.5 times or more above the prospective mortgage borrower’s income if they already have more than 15 per cent of its total mortgages at this level. Here the UK’s leading independent mortgage broker, Mortgage Advice Bureau, unveils how these caps will affect borrowers throughout the UK.

“In reality around 9% of all loans made are at 4.5 times a borrower’s income (or above) so there is still plenty of latitude for those borrowers whose borrowing requirement warrants this and where they satisfy the lender’s affordability model,” said Oliver Adair from Mortgage Advice Bureau.

Due to come into force on 1st October 2014, the new lending caps are just one measure introduced to ensure future affordability amongst borrowers.

“Lenders have already introduced a mortgage stress-test as part of their responsibilities under the recently introduced Mortgage Market Review. The BOE has now gone a stage further whereby a borrower must be able to demonstrate that they could still afford mortgage repayments should rates rise by up to 3%.”

The mortgage income cap is only expected to reduce lending by 2.5%, whilst London and the South East will be hit hardest as currently the ratio of mortgages where more than 4.5 times a borrower’s income is required is 19%.

Oliver added: “Don’t panic, if you were eligible for a mortgage prior to this new measure being introduced, then it is likely that you still will be. Lending volumes will be hardly touched by the plans, and smaller lenders will remain unaffected as Carney has excluded those that lend less than £100m per year – though it must be noted that not all lenders will stretch to the equivalent of a 4.5 times income multiple.”

The same principles apply to Buy-to-Let mortgage lending, which sits outside of these rules, whilst landlords will also remain unaffected.

“It is anticipated that lenders will begin putting the rules into place as soon as possible to prepare. Therefore, it is vital to get advice from a professional mortgage adviser who understands the new rules and which lenders will accept your personal circumstances,” concluded Oliver.

For further information please contact Oliver on 07917 146430 or email olivera@mb.org.uk. Alternatively, please visit www.dawsonsproperty.co.uk

Ricky Killay21072014_08-01

Silver award winning estate agent set to say a big thank you to its workforce with company-wide celebration

After receiving the silver award for Wales Lettings Agency of the Year at The Lettings Agency of the Year Awards 2014, independent property expert Dawsons is set to host a celebratory evening for each and every member of its lettings workforce.

 

Dawsons attended a star-studded ceremony in London to collect the prestigious industry accolade. Run in association with The Sunday Times and The Times and sponsored by Zoopla Property Group, the team were joined by 500 other leading lettings agents at the glittering event, which was presented by best-selling international author, inspirational speaker, presenter and charity campaigner Katie Piper and renowned journalist, author and newsreader Penny Smith.

 

Ricky Purdy, Residential Lettings Director, said: “Being presented with the silver award was certainly a collective effort and I would like to thank the Dawsons team for their involvement. Through the rigorous judging process, which involved telephone interviews and mystery shopping exercises, our service shone.”

Residential Lettings Director Ricky Purdy with some of the Dawsons Staff
Residential Lettings Director Ricky Purdy with some of the Dawsons Staff

42 members of the Dawsons lettings team will be attending an evening celebration as part of the company’s ‘thank you’ for their hard work during the last 12 months. The windows of their branches have also been dressed to reflect their recent achievement.

“It’s a great achievement to receive the silver award for Wales Letting Agency of the Year, and rest assured we’re aiming for gold next year so watch this space!” concluded Ricky.

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Swansea estate agent welcomes new additions after jobs surge

Leading independent estate agent Dawsons has announced further jobs growth for the South West Wales area.

In the wake of receiving the silver award for Wales Lettings Agency of the Year at the prestigious Lettings Agency of the Year Awards 2014, Dawsons has welcomed several new additions to their team. Charlie Williams and Laura Waite have joined their Llanelli branch, whilst their Morriston branch welcomes Bernadette Howells to the team.

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The estate agent’s Marina office sees Catrin  Kingston join their growing team. The final addition is Stephen Cadmore, who will be based at Dawsons’ Mumbles branch.

“We’re delighted to welcome each and every new addition to the wider Dawsons family. As an independent estate agent we are passionate about providing opportunities within the local area and feel that the expertise offered by our new staff members will not only enhance our existing team but provide a better service to our residential and commercial clients,” said Ricky Purdy, Director of Residential Lettings at Dawsons.

The Dawsons team has grown significantly in recent years and now employs around 116 staff members. The firm is independently run by three individual partners, all of which use their 20 plus years of experience to guide the wider team. With branches in Swansea, Gorseinon, Killay, Llanelli, Mumbles, Morriston, Sketty and Swansea Marina, Dawsons attributes its wider success to its team’s experience, expertise and local knowledge.

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Ricky added: “After our recent success at The Lettings Agency of the Year Awards 2014 it seemed like the perfect time to expand our team and utilise experienced new employees across all of our branches. I would like to thank the staff at all of our branches and look forward to following the progress of the newest members of the team.”

 

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Leading independent estate agent receives national recognition after winning prestigious industry accolade

Dawsons has been named winner of the silver award for Wales Lettings Agency of the Year at The Lettings Agency of the Year Awards 2014.

Run in association with The Sunday Times and The Times and sponsored by Zoopla Property Group, the Dawsons team joined 500 other leading lettings agents in London to attend the star-studded ceremony.

Held at The Lancaster London Hotel overlooking Hyde Park, the ceremony saw best-selling international author, inspirational speaker, presenter and charity campaigner Katie Piper announce the winners of the coveted awards. Renowned journalist, author and newsreader Penny Smith also acted as compere.

Dawsons, winner of the silver award for Wales Lettings Agency of the Year, was delighted to receive the accolade. Ricky Purdy, Residential Lettings Director, added: “This award is a great achievement for Dawsons and all staff within the lettings department. This year’s competition was greater than ever with the panel of industry experts paying tribute to all winners being very much at the top of our industry.”

The awards ceremony marked the end of a rigorous and thorough judging process. A panel of 21 industry experts assessed initial entry submissions before conducting an extensive review of the entrants, which included over 12,000 minutes of telephone interviews and mystery shopping exercises. This process was overseen by The Property Ombudsman, Christopher Hamer.

Now running for over 10 years, these awards have become widely recognised as the most prestigious and difficult to win. The awards welcomed more entrants than ever before, nearly 6,000 offices were represented this year, but only the very best were crowned as winners.

“We have a wealth of experienced and knowledgeable staff within Dawsons that are deserving of this accolade and recognition. This award recognises their great efforts over the past 12 months,” concluded Ricky.

David Treharne

How is the Mortgage Market Review helping you prepare for the future?

With mortgage rates now increasing, both current and prospective homebuyers need to be aware of the increase in their mortgage repayments when interest rates eventually rise.

The Mortgage Market Review (MMR) was officially introduced by the Financial Conduct Authority (FCA) in April to allow lenders to determine a borrower’s affordability. Here the UK’s leading independent mortgage broker, Mortgage Advice Bureau, reveals how the Mortgage Market Review’s stress test could help buyers prepare for the future.

Under the MMR rules, lenders must check that you can afford your repayments both now and in the future, and they do this through processes such as mortgage stress tests. The stress test gives lenders all the information they need regarding your finances, from how much you earn to how much you spend on food, utilities and even leisure.

“With a base rate rise inevitable, the FCA has stated that borrowers must not receive a loan if a bigger mortgage repayment could ‘break’ their finances. You will be extensively checked, with your day-to-day finances and spending coming under intense investigation,” said David Treharne from Mortgage Advice Bureau.

“Research carried out by Experian this month revealed that homebuyers are underestimating what their mortgage repayments could be by as much as £650 if interest rates were to rise. Whilst this may sound like a frightening statistic, this is one of the main reasons why the MMR has been introduced to the market.”

As well as ensuring that a return to irresponsible lending that took place in the run-up to the credit crisis is avoided, the MMR aims to protect borrowers from falling behind on their repayments so doing a check now will prepare you in good time for when rates rise.

When the Bank of England’s Monetary Policy Committee votes to increase the base rate, expectations are that it will be increased in a controlled manner until it reaches between 3-6 per cent to minimise the risk exposure level.

David added: “If a homebuyer was to purchase a £235,000 property and had a combined average household income of £50,674, research by Experian shows that they are claiming they can afford an average mortgage repayment of £780 per month. However, if rates were to increase by 5.5 per cent at the end of a typical two-year fixed deal, the homebuyer could find themselves paying around £1,440 per month!”

As the economy continues to improve, interest rates are inevitably going to rise. This is why it is better that the MMR is letting borrowers know now how much they can afford, rather than a year from now, when it is too late.

“Whilst the MMR continues to look to the future, so should you. Regardless of what measures are taken by the Bank of England and the Government, there is always going to be a risk factor when taking out a mortgage, which is why considering taking out income protection insurance and seeking professional advice should be a serious consideration,” concluded David.

For further information please contact David on 07501 720320 or email davidtr@mab.org.uk. Alternatively, please visit www.dawsonsproperty.co.uk