How U.K. property performed in 2012

US-PDGov

By Cormac Reynolds

According to Halifax, the UK’s largest lender Southend saw the largest rise in house prices of any place in the UK during 2012. The area saw a 15% rise in its prices over the 12 months, compared to a 1% fall overall the country.

The largest gains in house prices were made in the South East of the Country, whereas the largest drips were in Wishaw in Scotland and Craigavon in Northern Ireland. However, overall there was little change in the housing market in the UK over the period even though there have been large disparities country wide.

The best towns are those that are located within commuting distance of the capital and Basingstoke, Rochester and Southend all report rises of over 13%. Halifax has taken these figures from only its lending so it may not be 100% accurate.

South-East performance

According to the Land Registry the price of houses in London rose by around 7% and Brighton and Hove followed with a 4.7% gain over the 12 months to October 2012. However, the Land Registry only reports a 2.4% gain in Southend for the same period, which would suggest otherwise than the Halifax figures. The rest of Essex has seen a 1.5% gain on average.

One of the factors behind the rise in prices is the increase in the mortgages being lent, which increased a number of times in the year on 2011 levels. According to the HMRC the number of homes bought had been 6% higher than in 2011. There were over 91,000 in November 2012, the highest since December 2009, almost three years ago.

UK house buying companies have noticed an increased amount of activity with many looking to them to sell my house fast so they can purchase a new larger home. They believe that this has come about due to easier lending.

Experts

Experts in the housing industry also think that the rate of house buying and selling may increase to an even further degree in 2013. The Council of Mortgage Lenders and the Royal Institution of Cartered Surveyors believe that there will be a rise in the number of homes bought and sold and this activity will be down to the governments Funding for Lending Scheme. This scheme is allowing banks and building societies the opportunity to lend money to first time buyers who wish to fulfil their dream of buying a home.

Add to this the low cost of interest and you have the lowest mortgages ever seen, which has led to increases in lending month by month. However, the biggest issue people find is the deposit, which they need to get on the housing ladder.

Cormac Reynolds writes for UK company YouSellQuick and has written on finance topics for a range of clients

The Correlation Between Mortgage Rates and Home Sales

Low mortgage rates are thought to lead to higher sales numbers due to the economic theory of supply and demand. However, this relationship between mortgage rates and home sales numbers is not always as strong as some economists might think. This is made evident in a study by Christopher Mayer and R. Glenn Hubbard of the Columbia Business School whose findings indicate a more diverse set of influences on home sales.

CC BY 2.0 Attribution "Tasja"

In light of the above findings, the correlation between mortgage rates and home sales numbers involves understanding additional variables that can influence home sales. Examples of these factors include Federal Reserve Bank 'quantitative easing' policy, the business cycle of the mortgage industry, economic conditions and federal regulations. Despite all the additional variables that influence mortgage rates and home selling, the connection between mortgage rates and home sales is relatively strong when averaged out historically.

• Quantitative easing

Quantitative easing is a policy practiced by the U.S. Federal Reserve Bank when economic conditions warrant an increase in financial liquidity i.e. availability of funds for banks from the Federal Reserve. When the Federal Reserve Bank lowers its Federal Funds Rate, the affect tends to directly correlate with mortgage rates as the availability of money increases. Another program the Federal Reserve Bank implements is Permanent Open Market Operations (POMO). This program eases the financial strain on financial institutions that are connected to the mortgage industry via purchase of mortgage backed securities

• Statistical significance

The correlation between mortgage rates and home sales numbers is only valid when statistically significant. Moreover, quantitative easing only works under normal market conditions, and not necessarily when the economy is struggling in an exceptional recession, is in a secular trend, or during a housing market down cycle. For example, in an October 2006 document by James D. Hamilton, Economist at the University of California, San Diego, it is claimed the drops in the Fed funds rate leads to changes in mortgage rates that create increased home sales, albeit over time. However, two years later, throughout 2008, home sales declined despite historically low mortgage rates.

• Historical economic trends

The relationship between mortgage rates and home sales numbers is also evident in the economic history of the United States. Historically, when demand for mortgages drop, an indirect correlation also exits between mortgage rates and treasury yields as these financial instruments also decline during times of economic contraction. This pattern is evident in graphs of historical mortgage rates and 10 treasury yields plotted over a timeline. Moreover, the trendline reveals more often that not, that mortgage rates lower when 10 year treasury yields also decline indicating another relationship between government debt and mortgage rates. This is evident in this graph of Federal Reserve data presented by Mortgage and Refinancing Info.

• The U.S. housing market

After the severe decline in U.S. housing market valuation(s) in 2007, the prices of homes plummeted and a financial crisis ensued. As a result of the financial crisis, lenders saw a drop in demand for home loans which caused a corresponding drop in mortgage rates. When graphed, a clear pattern between home sales and mortgage rates emerges suggesting a drop in one may also lead to a decline in the other rather than a rise in home sales due to lower costs. In other words, lower mortgage rates may also have a non-inverse relationship with home sales when a housing market is in a strong enough downward cycle.

• Mortgage regulation

Mortgage regulation also impacts the correlation between mortgage rates and home sales numbers. Following the housing market bubble burst between 2007-2008, the financial services industry gained increased government scrutiny regarding lending practices. A result of this was tighter lending rules requiring larger down-payments, higher consumer credibility and consumer protection rules. One such example being the Dodd-Frank Wall Street and Reform and Consumer Protection Act of 2010. A potential financially adverse side affect of all these rules is an inhibition in the rate of lending despite their perceived benefit to the economy and consumers.

Sources:

1. http://bit.ly/bNMs3p (Federal Reserve Bank of Dallas)
2. http://bit.ly/d5NRSR (Hubbard, Columbia Business School)
3. http://bit.ly/bAjrMx (Bloomberg)
4. http://bit.ly/boXnJX (Hamilton UCSD)
5. http://bit.ly/cLrJH (Truth about mortgages)

Home Selling Tips for Missouri Residents

The Missouri housing marketing includes cities such St. Louis, Kansas City, Columbia and Jefferson City. There is also a housing market for vacation, rural and smaller cities and towns in places like Lake of the Ozarks, Branson, Springfield, Blue Springs etc. The housing market is different in many of these areas due to Missouri demographics and economics, but similar to other States in terms of the national or regional economy and housing market.

Naturally, selling the home at a time when the most money can be easily acquired for the home is ideal. However, in both tough and smooth markets, and for Missouri housing markets, it can be helpful to 1) know your market, 2) place your home in the market properly, and 3) make your home worth buying. This article will discuss these 3 points in the following sections.

Section 1: Potential market for Missouri home buyers

Knowing each individual market within Missouri can be helpful in assessing who the appropriate target market for the home may be and whether or not real estate investing is a good idea in that market. To illustrate further, the State of Missouri has several unique characteristics that can be indicative of its potential home buying markets. Some attributes of the State of Missouri that assist in defining the market for people with homes for sale in Missouri are described in the next paragraph.

Missouri is a State that borders 8 other States so it also sees a lot of interstate traffic. The State is also home to several Universities including the University of Missouri system which includes Columbia, Kansas City and Rolla. Jefferson City is the Capital of the State and the State currently has a Republican led Government. The State is home to several National sports teams including the St. Louis Cardinals, Kansas City Chiefs, and Kansas City Royals and has a significantly large agricultural community and economy.

Due to Missouri's diversity, economy, location, social demographics and location in the United States, several distinct population groups may be more likely to seek out homes to buy in various parts of Missouri. These groups are potential target markets for people with homes for sale in Missouri, as mentioned in point 1 in the 1st paragraph above. A few of these potential markets are listed below in no particular order.

• Interstate truckers

• Agricultural workers, administrators, farm owners etc.

• Out of State professional relocating to Missouri

• Newly wed couples and new families

• Recent Doctoral and/or Fellowship enrollees

• House flippers, investors and up-graders

Section 2: Placing a Missouri home in the property market

After a target market is identified, pursing that market is just as important as identifying it. Placing your home for sale in the market properly is an essential step for people with homes for sale in Missouri. This involves making buyers and potential buyers aware of the property, facilitating the process of learning about the real estate and encouraging interest in the home. Several general methods can be used to promote this process, however additional techniques unique to each market and micro-market may also be beneficial.

To place a property on the market the home can be listed independently, or via a Real Estate Agent or Realtor. If put on the market independently, being very clear on the home buying and selling process is important as there will be no agent to assist if one is not used. Secondly, if an agent or Realtor is utilized, get a feel for their marketing style, efficiency and know how. An effective and helpful Agent or Realtor can have a considerable impact in properly placing a Missouri home for sale in the housing market.

• Make sure the home is listed in the MLS or FSBO system

• Talk to neighbors, family or friends about the home

• Advertise locally and in addition to the Agent or Realtor's efforts

• Be aware and make use of up to date and helpful marketing tools

• Actively seek out buyers most likely to be interested

• Provide seller financing if possible

• Have a good and legitimate reason for selling

Section 3: Making a Missouri  home worth buying 

Once the home for sale in Missouri is placed on the market, making the home attractive to buyers is also important. Different people have different concerns, look for certain things in a new home and naturally want to get the most for their dollar. Appealing to these interests is beneficial in promoting the home for sale in Missouri in addition to helping make the property worth buying.

To help make a Missouri home that is for sale worth buying several general and specific methods and techniques can be used. General techniques include selling ideas that assist in attracting Missouri and out of State home buyers/target market on a broad level. Specific methods for making a Missouri home for sale worth buying include more focused, localized and micro-market specific. For example, many people like homes to have aspects such as functional wiring, plumbing, doors, cleanliness etc. Some general things one might consider in making a Missouri home for sale more interesting are listed below.

• Price the home at or slightly below neighborhood homes with similar features

• Only upgrade the home for those things that add more value than the lowest cost

• Remove clutter from home and tidy lawn

• Repair cosmetic flaws of the home

• Offer a reasonable asking price

In the case of more specific markets may be interested in things like proximity to good schools, neighborhood characteristics, location near work or in certain areas close to parks, churches, commercial venues etc. It's difficult if not impossible to appeal to everyone within your target market so becoming aware of the more probably home attributes that are more likely to appeal to a larger market can be a good way to approach the step of making a home worth buying for people with homes for sale in Missouri. Some specific ways that may make the home worth buying for home-buyers in Missouri include the ideas listed hereafter.

• Similarity of home with neighborhood traits, ex-proportional square footage

• Features that suit the surrounding environment, ex-shed for large lawns

• Suitable space for vehicle(s), ex-double driveway or parking garage

• Cost saving features, ex-energy efficient windows

• Interior design, ex-bathroom with a fan

Summary

For people with homes for sale in Missouri, selling can be easy or difficult depending on overall market conditions. However, making use of methods and techniques that can help sell a Missouri home within less time can be worthwhile in some cases. The steps in this article address improving prospects for selling a home in Missouri, but don't guarantee that such methods or techniques will be successful. Those techniques include identifying a suitable market, promoting to those Missouri and other home-buyers within that market and appealing to those home buyers' interests, wishes and/or expectations for a home.

Tips for Selling a Home at the Right Price

"Sold" is the word all home sellers are after, and for the best price possible, and in as short a time as possible after the house hits the market. To have a house hit the ground running takes some consideration of a couple of C's, one L, a couple of R's and one P; namely clutter, cosmetics, landscaping, restoration, repair and price. 

It may seem like a lot but some of these things can be done with a little time and patience and cost effectively. Keep these things reasonable in terms of cost and also remember neighborhood price ceiling is important as a house that is rejuvenated beyond the class of a neighborhood will have a tough time selling at a price that compensates the owner for all the time, energy and money put into the house. So be wise with a house and perhaps most of all show it some love. The following sections of this article outline some of the things potential home buyers look for in a house.

Marketing venue

Another important step in preparing a home for sale is making sure everyone knows about it. Finding a suitable venue to market the property can prove priceless in selling a home. A motivated Real Estate agent or Broker may be the right solution for you if you don't have a lot of practice selling homes or with the lengthy paperwork procedures required. Also, owner-financing options may be appealing to those buyers seeking an alternative to a bank mortgage thereby increasing potential interested buyers.

Reduce clutter

Realtors and Sales agents will repeat the mantra clutter is bad for home sales. This is true because of market perception, a cluttered house reflects a possible unkempt house, and is simply not as visually appealing as a house that looks like it came off a beautiful homes magazine cover page. The less things lying around the house the better as more space is added to the appearance making the house seem bigger and cleaner.

Cosmetics touchups

The small things do matter. For example, those little door stoppers that cost a couple of dollars at the hardware store not only protect the walls from doorknobs but they're easy to install and cost effective. Door stoppers show love and prevent damage; with a little time just about anyone can install these little but important house amenities. The list of cosmetic touch ups are endless, but the principles of low cost, rejuvenation and damage prevention still apply. The more cosmetic touch ups one can do, the better the house will look to potential buyers.

Landscaping

If you have a yard, a little beauty can go a long way especially if the house is up for sale in the late spring, summer or early fall. Selling the house in the season your house looks best can also give the impression of beauty and finesse. Also, when this technique is used mother nature does a lot of the work and for free. Besides mother nature, keeping lawns mowed and trimmed, installing some tasteful plants in a flower bed and removing yard clutter can also improve the saleability of a house.

Price

The price of a house is important for the buyer, the seller and the agents if there are any. Everyone wants a deal and that can be tricky. Choosing a price that is realistic, and fair to everyone will probably earn a homeowner a little less profit but a bird in the hand may be better than two in the bush. Pricing can be complicated and involve tax implications, profit, market timing and other factors. For this reason think carefully about a price and discuss it with an agent and/or family members

Repair

It is sometimes unavoidable, but houses do need repairs just like cars. Things like holes in the wall, broken rafters, damaged siding, doorways, windows, foundation etc. all have their place in the re-saleability of a home. Inspectors will generally find what's wrong with a house and savvy home buyers also know what to look for so trying to hide these things probably isn't a good idea as it could create mistrust and a no sale. Being fair with repairs fixing what is important, and perhaps negotiating other repairs with a homebuyer for a reasonable deduction in home sales price could get you the sale you are looking for.

Restoration

Some homes if not many have flaws in one place or another. Prioritizing things in need of repair can make the task more manageable and cost effective. For example, if the furnace is 17 years old and you live in a climate with cold winters and the driveway isn't paved but looks like a weed festival which is more important to a new homebuyer? Chances are a buyer would appreciate a new furnace more than a concrete driveway. Functionality of a house is important and home buyers don't always want handy man specials. Restoration may also involve less expensive things like paint, wall trim, door knobs, broken pieces of fence, faucets, vents, linoleum etc. Installing and rejuvenating many things in a house can be cost effective and do wonders for a house.

Summary

Homes are great places and a home treated with love shines. Selling a house can be stressful and exciting especially if the homeowners are attached to the house and are moving to a new house. Homes take time to rejuvenate, but time on the market can be bad for a house for sale. Using various techniques and methods provided above can improve the saleability of a house and that is good to know. There may be some things about a house that only a homeowner knows about like a giant snake living in the basement or ghost like apparitions that appear at 2:00 Am every Wednesday.

If these anomalies plague a home and that is the reason for selling it might be better not to mention them in the disclosure form or to the buyer but doing something about them before the house goes on the market might be a good idea too. If the seller puts him/herself into the buyers shoes and thinks what they might want when buying a house it can help in the choice of preparations involved. 

To illustrate the previous point, if the home is a family home, preparations that a family would appreciate would probably be more beneficial than preparations that suit a single musician who needs a lot of space for musical instruments and acoustics. The list of considerations to think about when preparing to sell a house can be extensive but with a little practice and some good direction it can be manageable and doable.