Zoomf News

Zoomf, the UK’s leading property search engine, will be running a series of free seminars during 2008 focusing on web marketing for estate agents.
The first seminar of the year will take place at 6.30pm on Wednesday 6th February at the British Computer Society.

The seminar is entitled ‘Searching for profits’, a topical subject in the current economic climate, with property prices dropping and sales activity declining. Specific issues to be discussed include:-

• using web 2.0 marketing techniques to gain business
• the effectiveness of property portals
• the impact of the change from a seller’s to a buyer’s property market

Each seminar will start with a short presentation and end with a Q&A session for the audience addressing questions to the panel of speakers. Speakers will include Zoomf’s very own Mike Carter, on-line marketing guru Mark Hopwood of Snow Valley, prominent London estate agent Mike Toogood of Square Mile and the well known on-line property blogger, Harvey Edgecombe of Renthusiast. The session will be moderated by Poppy Dinsey, Zoomf’s property sector commentator.

The audience will consist of estate agents, trade press and other industry influencers. The previous seminar, held in September 2007, was a well-attended event and led to a spirited debate about the world of web 2.0 and property.

Mike Carter, a director at Zoomf, comments: “We are constantly asked by agents how they can make their online marketing spend more effective. These seminars will give us a platform to answer many of these questions as well as provide us with the opportunity to hear feedback from key players in the industry on how we can improve our service to meet the most urgent needs of agents.”

Contact marianna@zoomf.com to secure your place at this not to be missed event.

If one needs further confirmation of the fact that banks are anticipating a certain downturn in house prices, the latest sign of that has been provided by two of the UK’s prominent mortgage lenders, Britannia building society and Alliance & Leicester. The two have doubled the minimum deposit sought from fresh buyers.

Borrowers will be required to shell out a minimum deposit of 10 per cent on the value of a property in comparison to just 5% previously. This increases the average deposit cost from £7,392 to £14,783  (based upon the average price of a first time buyers home of £147,834).

According to reports from Moneyfacts - the financial data provider – more than 10 mortgage lenders have cut down the maximum ‘loan-to-value’ ratios on most of their mortgage range from last December. This has clearly marked an about-turn from the position before the credit crunch, when lenders had pushed ‘loan-to-value’ ratios to whopping highs of 130 percent, with 95 per cent the norm.

Trying to get the cash for a deposit is often cited as the toughest challenge for most first-time buyers. Obviously, the rise in deposits is going to deter them. A Britannia spokeswoman stated that a decision has been made to impose a maximum ‘loan-to-value’ limit on all products of 90 per cent at the end of December 2007. This is owing to the prevailing external environment, with house prices continuing to fall.

There are two conspicuous sounds linked with the Newquay’s Cornish resort at the moment - the clang & clatter of heavy machinery and the crashing of surf. Developers in the UK’s ’surf capital’ are experiencing boom times even while their counterparts in other parts of the country are gloomily pondering what the New Year has in store for them.

The vastly improved transport links to north Cornwall, along with the ever-growing popularity of surfing, has started a race to construct new and more swish apartments. Two penthouse apartments here have just been sold off for over £1m, amid speculations that David Beckham was considering to invest.

Such is the rapid pace of developments no one seems sure just how many new constructions are coming up. The closest guess is at least 1,400 properties are either going through the planning stage or are under construction.
According to land director with the Acorn Property Group (for the south-west), Stuart Brereton, well-to-do, young people are very keen on investing not just in bricks and mortar but also in the sizzling surf lifestyle that generates nearly £42m for Cornwall’s economy every year.

Buy-to-lets strategy can bring you a profit even in the turbulent property market. This despite the fact that buy-to-let may prove to be the first big casualty if the housing market happens to go belly up this year. Of course, investment buyers will first have to see where to locate properties at these prices.

According to property market analysts, investors should avoid newbuilds in city centres and move to secondary areas to buy secondhand albeit good quality properties - flats constructed a few years ago, older properties or conversions. Thus, they won’t be required to pay a new home premium and will avoid competing in a location that is over-supplied with flats to let, property experts suggest.

They point out that most prime city centres are having too many flats to rent. According to estate agency Knight Frank, nearly 87 per cent of homes in the central Leeds area are one and two-bedroom flats, with 40% privately rented. Roughly 70% of new homes in the central Manchester area since the beginning of the new millennium have sold to landlords whereas in Sheffield, the figure stands at 65% since 2002. Trends and statistics from Liverpool and Newcastle are similar.
Situation of an over-supply is not likely to be corrected in a hurry at least in the near future. So, each month many buy-to-let investors need to top up their investment without the prospect of significant capital gains, note estate agents.
Taking all the above factors into account, property market analysts contend that would-be investors are better off heading for the suburbs.

Richard Donnell, research director at Hometrack property consultancy concedes that in the past one could buy a flat, let it and not worry about rent levels as you would depend on capital appreciation. Unfortunately those days are gone. He states that so-called ‘rational investors’ ought to forget and forgo capital appreciation and should instead look for a minimum rental income for ensuring decent returns. In related research published in The Daily Telegraph it has been assumed that a rational investor would want around 7.5 per cent annual yield, or in other words, he or she will like to recover 7.5% of the purchase price each year in rent (before tax).
With this target or assumption in mind, following aspects have been analysed:
• Local property prices, particularly for two-bedroom flats, the typical rental home
• Demographics, particularly clusters of under-35s – typically, the young, single professionals, student and other would-be first-time buyers who have to rent
• Renters’ Average income and how much they will typically pay in rent.
Using the above data, it has been calculated as how much rational investors should be paying for a two-bedroom flat in any of the top 15 locations across Britain.
The results give some hints to those would-be landlords. In Leeds, for e.g., they should purchase a two-bedroom flat for around £124,800 and give it on rent for £180 per week to reach the target 7.5% annual yield. For the same output in Brighton they should pay just about £149,067 and rent the property for £215, the research paper suggests.

Small market towns are turning more and more desirable, as much for their schools and shops as natural beauty. Many of country’s finest country towns are drawing considerable attention in the property market. They are beacons of aspiration, prosperity and enterprise. They are the perfect settings for a variety of the most unusual shops, some classic novels, and Britain’s agricultural lows and highs. They are considered the core of the countryside.

These town settings largely tend to be recession-proof for the turbulent property market. Head of country house sales, Strutt & Parker, Michael Fiddes, mentions that they have turned key drivers in Britain’s property market since more people opting to move out of London have understood the need for shops, restaurants and schools close by.
Britain’s leading publication The Daily Telegraph has come up with a list of 10 finest towns. The daily has canvassed over 100 agents and talked to property experts in the country for the purpose. And which English town has grabbed the No 1 slot? Well, it’s the lovely town of Arundel located in West Sussex.
Following criteria have been applied to decide the rankings:
• Historical-natural settings like an abbey, castle or a beautiful natural backdrop
• Independent and pristine landscape
• Specialist shops and boutiques

If you happen to be one of those nearly 1.4m homeowners who have accepted the fact that they are nearing the end of a cheaply available fixed-rate deal, you should heed to the following advice: stay away from mortgage misery in the New Year.
The first important piece of advice is to make use of any spare cash pile for cutting down your existing mortgage balance to maximise the component of equity in your property holding.

The next thing to bear in mind is not to get tempted to utilise your home simply as a piggy bank for funding things like a brand new car.

If you’re going to release equity, ensure it is for things such as home improvements which will add value to your property.
Few other tips to avoid impending mortgage misery are:
• You should consider payment of a higher arrangement fee for obtaining the lowest discounted, variable & fixed rates, especially if you’re borrowing a significant amount of money.
• Fixed-rate mortgages are seldom cheapest at first but eliminate the risk that your costs may go up in future.
• Individuals with rather large mortgages and the need for a piece of mind may resort to fixing.

The cost of mortgages has been going up for last several months. In fact, there seems very little respite in store for borrowers, in spite of predictions of further cuts in interest rate in the coming months. The scenario leaves millions of hassled homeowners at risk.

According to one estimate by the Financial Services Authority (FSA), well up to 1.4m homeowners could struggle when their fixed-term mortgages get expired this year. Borrowers with a fixed-rate repayment mortgage of up to £200,000 could end up with monthly payments with an increase of up to £200 a month.

Homeowners are now being urged not to default on any dues on their credit cards or mortgages since this could well affect their credit record. They are being advised not to stop or miss payments of dues as this could result in the loss of their homes.

What other advice is there for homeowners in these tough times? Well, they should talk to their lender about any difficulties being faced in repayment. A lender is less likely to drag a defaulter to court if the latter is communicating.

Homeowners should ask their lenders if they can cut down monthly payments or suspend them for a while to overcome temporary credit problems.

To cut costs, they should find out if the lender is agreeable to extending the period of mortgage or convert it to interest-only basis from repayment basis.

Spend mere 70p to get £1 worth of assets plus a decent yield. Could this be a tempting punt for bold investors, or is it still too early?

Savvy investors can often make a killing by opting to go against the herd mentality. This is the reason why the contrarian approach may open up a paying path for some good opportunities in the beaten down commercial property segment.

Commercial property funds have crumbled sharply in value, and many panicky investors are in a hurry to exit them.

However, a section of experts claim that now is an ideal time to purchase one of those open-ended property funds like a unit trust.

The share prices of most investment trusts and some real estate investment trusts (Reits) are tumbling. The fall has been so steep that many of them are priced at considerable discounts to the underlying assets’ net value - 30 per cent or higher.

To put it in other words, you’re paying 70p for owning every £1 of assets. Could this be construed as a perfect buying opportunity for those contrarian investors who always look to go against the prevailing market sentiment?

Anthony Bolton, Fidelity’s former star fund manager, is one of those major contrarians. He feels that attractive bargains are available for a gainful entry into heavily tumbled British property stocks.

According to Bolton, the opportunity has been made available owing to the sell-off of listed property firms that looks overdone.

Homeowners that were banking on the cost of their existing mortgage repayments to dip in 2008 are facing a setback. The Bank of England has decided to leave rates unchanged at 5.5 per cent. The blow comes just after the realization that many lenders have still to pass on rate cut of December to its variable rate mortgages.

Jonathan Cornell, MD at the UK mortgage broker Hamptons International Mortgages, commented that the decision of the Bank of England to hold the base rate this month, makes previous month’s decrease look nothing more than a goodwill gesture. According to Cornell, what will really upset and hurt mortgage borrowers is the persistent failure of mortgage lenders to pass on previous month’s fall in their mortgage repayments.

While borrowers on a mortgage that tracks the BoE base rate should have felt the impact of previous month’s cut almost instantly, those sitting on SVR rate of their mortgage lender will not be so thrilled and will need to wait for LIBOR rates to begin to take a similar fall before they get any respite.

Many lenders have opted to stick by their guns in spite of Gordon Brown stating that they (lenders) had a ‘duty’ to pass on cuts in interest rate. But despite his reminder, top mortgage lenders state that further reductions would not necessarily be passed to borrowers.