Monthly Archives: March 2015

Weekly Round-up, 27th March 2015.

Flat rate.

According to latest news from the Office of National Statistics the Consumer Prices Index (CPI) was unchanged in the year to February 2015, that is, a 12- month rate of 0.0%, down from 0.3% in January.

The main contributions to the slowdown in the rate came from price movements for a range of recreational goods (particularly data processing equipment, books and games, toys and hobbies), food and furniture/furnishings. There were no large upward effects to offset the change.

Consumer price inflation is the speed at which the prices of goods and services bought by households rise or fall. Consumer price inflation is estimated by using price indices. One way to understand a price index is to think of a very large shopping basket containing all the goods and services bought by households. The price index estimates changes to the total cost of this basket.

A price index can be used to measure inflation in a number of ways. The most common is to look at how the index has changed over a year. This is calculated by comparing the price index for the latest month with the same month a year ago. This is known as the 12-month inflation rate.

The CPI is also used for purposes such as uprating pensions, wages and benefits and can aid in the understanding of inflation on family budgets. This means that a basket of goods and services that cost £100.00 in February 2014 would have still cost £100.00 in February 2015. This is the lowest 12-month rate on record. The previous lowest CPI 12-month rate was 0.3% in January 2015.

Over the last five years, the three main contributors to the 12-month inflation rate have been: transport (including motor fuels); housing, water, electricity, gas & other fuels; and restaurants & hotels. Combined, these three sectors have, on average, accounted for around half of the 12-month inflation rate.

In the year to February 2015, food prices fell by 3.4% and prices of motor fuels fell by 16.6%. This continues the downward trend in the price movements in these product groups, with prices falling or remaining unchanged on the year for 10 and 18 consecutive months respectively. The food and motor fuels groups in total reduced the CPI 12-month rate by approximately 0.9 percentage points.

Demand and subdued supply.

According to the Nationwide, annual house price growth slowed to 5.1% in March from 5.7% in February, the seventh month in a row with UK house prices rising by 0.1%

UK house prices are currently around 2% above their pre-crisis levels with Economic conditions remaining supportive; labour market conditions continue to improve and mortgage interest rates are close to all-time lows. Nevertheless, the pace of housing market activity has remained subdued, with the number of mortgages approved for house purchase in January around 20% below the level prevailing one year ago.

The Nationwide have reported that there is still significant regional variation. Prices in London and the South of England continued to see the strongest rates of annual growth, though there was a noticeable softening this quarter, particularly in London. Price growth also continued to cool in the North West of England, Scotland and Wales, even though prices in these regions remain some way below their 2007 peak. Indeed, in annual terms, prices in Wales declined by 0.5% in Q1.

There has only been a modest pickup in house building after the sharp fall seen in the wake of the financial crisis. For example, in 2014 around 119,000 houses were built in England. According to the Society, this is 11% higher than the low point seen in 2010, but 25% below the average rate of building in the five years before the financial crisis. Moreover, official estimates suggest that even before the crisis, building activity was running below that required to keep up with the natural growth in the population.

The suggestion in the report is that major house builders appear to have capacity to expand supply, with most reporting land banks, which, at current rates of building activity, could support construction for more than five years. Demand prospects remain favourable thanks to the strength of the labour market, continued low mortgage rates and schemes such as Help to Buy, which are helping to provide those with smaller deposits access to mortgage finance. This in turn should help to provide house builders with confidence that there will be demand from buyers if the homes are built.

Oxford blues.

The past year has seen a deterioration in affordability in UK cities, driven by rising house prices across the country, according to the Lloyds Bank Affordable Cities Review. The average UK city house price has risen by 7%, from £181,667 in 2014 to £195,107 in 2015. This has resulted in affordability in the nation’s cities worsening in the last 12 months from 5.8 to 6.1 times gross average annual earnings; the second successive annual decline in affordability.

Affordability in UK cities is, on average, now at the same level as in 2009 but is 15% lower than the peak of 7.2 times earnings in 2008 at the height of the last housing market boom. The overall improvement in affordability across UK cities as a whole over the past seven years has been caused by a combination of an average house price decline of £12,630 (-6%), and an increase in the gross average annual earnings in UK cities of £3,058 (+11%).

Oxford’s average house price is 11 times (10.89) the gross average earnings in the city. At an average price of £361,469, houses in Oxford are more expensive compared with local average earnings than any other UK city. This is partly due to Oxford’s attractiveness to commuters working in London. Winchester (10.11), Cambridge (9.76), Chichester (9.19) and Brighton and Hove (9.10) make up the top five least affordable cities. Greater London is not far behind with average property prices 8.75 times average gross annual earnings. This average figure disguises considerable variations across the capital with central boroughs being significantly less affordable than the Greater London average.

Stirling remains the UK’s most affordable city despite a deterioration in affordability over the past year. The average property price in the Scottish city of £158,645 is 3.9 times gross average annual earnings. Four of the ten most affordable UK cities are in Northern Ireland due primarily to the relatively low house prices in the country: Londonderry (3.92), Belfast (4.49), Newry (4.51) and Lisburn (4.63). Lancaster (4.03) and Bradford (4.17) are the most affordable cities in England.

A clear north-south affordability divide remains among UK cities. Seventeen of the 20 least affordable cities are in southern England1 with Lichfield, Leicester and York completing the top 20.
At the other end of the spectrum, nineteen of the 20 most affordable cities for homebuyers are outside southern England with the exception being Ely in East Anglia.

Aberdeen has recorded the biggest price rise of any UK city over the past decade with a gain of 88% as a result of rising housing demand due to the strong performance of the oil and gas sector over most of the period. Cambridge (55%) and Brighton & Hove (52%) saw the largest increases in England. More recently, London has recorded the highest house price growth with a rise of 40% during the past five years followed by Winchester (39%) and Cambridge (37%). Eight of the ten top performers since 2010 are in southern England with the exception being Aberdeen (26%) and Durham (25%).

A second opinion.

New research from Bright Grey – part of Royal London, the largest mutual life, pensions and investment company in the UK – found that almost two thirds (63%) of people would take a second medical opinion if it was offered, when receiving a diagnosis from a medical professional. It also found that a quarter (25%) of UK adults have wanted a second medical opinion at some point, yet many (66%) have never been offered one.

Almost half (49%) of those surveyed believe a second medical opinion should always be offered when someone receives a diagnosis from a medical professional; and when asked about location and timing, the overwhelming majority (85%) said they would prefer it to be face-to-face; and almost half (49%) would like it to be provided by a UK based professional.

Other key findings include over half (58%) of UK adults saying they would want any recommended courses of treatment from a second opinion to be available on the NHS and only 15% of UK adults currently own a health-related insurance product.

The research was carried out online by YouGov from 19th to 20th March 2015. It surveyed members of the YouGov Plc GB panel of 350,000+ individuals. Emails were sent to panellists selected at random from the base sample. The responding sample (2,093 UK adults) was weighted to the profile of the UK population to provide a representative reporting sample, based on census data.

Strictly come Accident.

Be on your guard at 6.30pm on Saturday for it is the most dangerous time to be in your home, according to a new report this week. The UK population has over 80 million home accidents each year each one causing physical injury or property damage, with Saturday at 6:30pm the most dangerous time to be at home, the latest research shows.

A study by Electrical Safety First has identified that the number of accidents peaks on Saturday evenings when four accidents take place every second when more people are at home and could be in the kitchen cooking.

Although the riskiest days and times can be different, depending on your age and lifestyle. For example the most dangerous day for a student is Wednesday when they are most likely to start a small fire in the kitchen (12%) and at the same time most likely to remove batteries from smoke alarms (21%) and 13% of students admit to having tried to dry clothes or other objects in their microwaves.

Avoiding the kitchen could help with over a third of us (33%) admitting we’ve burnt ourselves on an electrical item, over half (55%) have injured ourselves while cooking and one in ten (10%) have experienced a fire in the home.

Mums were the group most likely to have a serious electrical shock but proved better chefs than dads who are most likely to have an accident whilst cooking. Retirees are least at risk on average, however almost a quarter (24%) admit to running over lawn mower cables.

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The Protection Manifesto.

The news this week that the parents of five-year-old Ashya King, who took him abroad for brain tumour treatment, have reported that their son is now free of cancer says a lot about the advantages of second opinions in the medical world. Without significant research and a stressful fight with the authorities on the part of the parents, their son may have not had the benefit of his treatment in Prague and what appears to be, on the face of it, a cautious recovery. New research from Bright Grey found that almost two thirds (63%) of people would take a second medical opinion if it was offered and a quarter (25%) of UK adults have wanted a second medical opinion at some point, yet many (66%) have never been offered one. Almost half (49%) of those surveyed believe a second medical opinion should always be offered when someone receives a diagnosis from a medical professional. So why is it that the public aren’t rushing to buy insurance that delivers the second opinions that two thirds want?

The launch last week of Global Treatment from Friends Life, Best Doctors through Friends and Ageas and the latest enhancement to Bright Grey’s Red Arc service are all benefits that target a real concern in the UK, especially when we hear the NHS is apparently in crisis. Over the next 6 weeks leading up to the election, the NHS will be highlighted as all political parties commit to spending more on delivering a better funded health service. Is it time for the protection industry to tell voters that they can take control themselves, commit their own money and invest in good quality insurance that can give them the peace of mind that, should the worst happen, help is available – help that the NHS can’t provide. Should we rename policy documents as the “Insurance Manifesto” , a commitment to provide support and help for hardworking families, a plan that can give them a long and healthier future, a pledge to see the family out of a potential financial crisis and one that can benefit most sectors of the community? Political broadcast for the Protection Party over.

Neil Hoare, Commercial Director

Weekly Round-up, 20th March 2015.

The Budget 2015.

Chancellor George Osborne presented his final Budget for this Government this week, and while many of the announcements had been largely predicted, there were a few surprise measures thrown in along the way.

The personal allowance, or the amount of income you receive before having to pay income tax, will rise to £10,600 at the start of the new tax year. It’ll then rise to £10,800 in the 2016-17 tax year and £11,000 the year after, with the Marriage Allowance increasing accordingly. The point at which higher earners have to pay 40% income tax – will also rise, taking it from £42,385 this year to £42,700 in 2016-17 and £43,300 in the following tax year. It’s touted as being the first above-inflation rise in seven years.

Fuel and wine duty will be frozen, but beer will see a cut of 1p, while duty on cider, Scotch whisky and other spirits will be cut by 2%. Business rates have been amended with corporation tax will be cut to 20%, and small business rate relief extended. National Insurance contributions will be abolished for employing those under-21 from this April and for apprentices from the next tax year. Class 2 National Insurance contributions for the self-employed will be abolished.

Pensioners currently locked into annuity contracts will be able to “sell” the income they receive by abolishing the prohibitive tax charge of 55% but the lifetime allowance on pension pots is being reduced from £1.25m to £1m.

There were some big announcements for savers, notably the idea of a flexible ISA. The tax-free allowance will increase to the planned £15,240 in April, but from September, the rules will change so that people can take money out of the account and put it back in at a later date without losing their tax-free entitlement. There was also the announcement of a Help to Buy ISA. A savings product designed for first-time buyers trying to build a deposit, for every £200 saved, the Government will top it up with £50, up to a maximum of £3,000 in any tax year.

And finally, with more good news for savers, a personal savings allowance was also announced: from April next year, the first £1,000 in savings income will be exempt from tax (the first £500 for higher rate taxpayers), a move that’s expected to bring 95% of taxpayers out of savings tax altogether.

Rungs getting wider.

The latest research from Lloyds Bank shows many homeowners are not progressing up the housing ladder as quickly as they had hoped, with one in three (33%) expecting to be further along than they are now. This proportion is even higher for first time buyers, with almost half (44%) expecting to have been further up the ladder at this stage.

In addition, four in five (83%) believe homeowners have to wait a lot longer to reach their long term family home than they would’ve done a decade ago, with just under a third of people (31%) worried that their own financial situation will create a barrier to moving.

Despite recent improvements in the housing market, four in ten (40%) still consider the housing market to be having an impact on aspirations, although this figure has fallen since 2013 (47%) and 2012 (53%). Almost half (48%) of first time buyers think that the housing market will have an impact on how long it takes them to reach their family home.

Even with anticipated delays in moving up the housing ladder, almost half (44%) expect not to make any compromises and believe their long term home is a realistic achievement and 18% expect it to be a better property than their childhood home. Over a third (36%) hope to achieve their housing aspirations by the time they are 45.

Despite an increase in the number of people feeling they need a bigger property, the house that the majority of homeowners in the UK aspire to own has three bedrooms (43%). Just under a quarter (24%) want four bedrooms, with many people aspiring to have nice gardens, conservatories and high quality kitchens and bathrooms.

Just under two in three (63%) homeowners believe they will reach their long term family home in less than five years. Almost two in three (64%) of those who are still waiting to be in their long term home think they will only have to make one more move to achieve their housing aspirations.

The average price of a three bedroom home in 2014 stood at £190,420, with the average total income of the occupants being £46,140.
Applicants for three bed properties, which are seen by many as long term homes, are on average 35 years old in London and the South East. This is a year older than the national average. These regions remain the least affordable in the UK for three bed houses, as a result of the high house prices.

In contrast, long term family homes in the North and Wales are more affordable with the average three bed property costing £129,447 in the North and £135,070 in Wales. Average incomes of the applicants are lower (£38,606 and £36,390 respectively), but long term homes are still more affordable in both regions. As a result the average age of the applicants is lower than the national average (34) in Wales (33) and the same as the national average in the North.

For more information visit www.lloydsbankinggroup.com/globalassets/documents/media/press-releases/lloyds-bank/2015/150313-one-in-three-lagging-behind-their-housing-aspirations-final2.pdf

February lag.

The Council of Mortgage Lenders estimates that gross mortgage lending reached £13.4 billion in February. This is 9% down on both January and on last February, in both of which months £14.8 billion was advanced. This is the lowest monthly estimate for gross mortgage lending since April 2013 when lending totalled £12.4 billion.

Commenting on market conditions, CML chief economist Bob Pannell says: “Earlier soft approvals data meant that weaker February lending has not come as a surprise. Seasonal factors tend to weigh on activity at the start of the year, but looking through these, the underlying picture appears to be stabilising. We expect lending to improve in the coming months, as employment and earnings continue to pick up and the impact of recent stamp duty reforms start to feed through.”

Grand a minute.

Aviva protection customers and their families received over £513 million through claims on life insurance, critical illness and income protection cover in 2014. This equates to around £1.4 million pounds a day, or almost £1,000 per minute.

The annual total paid to Aviva life protection customers shows a consistent year-on-year level. During 2014, Aviva paid £340 million to the families of life insurance customers who had died or been diagnosed with a terminal illness, almost £161 million to customers with critical illness (CI) cover and over £12 million to customers with income protection (IP) cover.

The data reveals that 14,805 families benefitted from life, CI and IP claims during 2014. This includes 11,198 life insurance, 2,246 critical illness and 1,361 income protection claims.

Over the year, the insurer paid 99% of life insurance claims and 93.2% of critical illness claims. Of critical illness claims which were not paid, 1.2% of them were declined due to misrepresentation (non-disclosure), and 5.6% for conditions not met.

For the last two years Aviva’s claims statistics have been compiled using the ABI’s industry guidelines, an approach that Aviva believes should be adopted by all providers so that customers can be confident statistics are calculated in a consistent and transparent way.

Key statistics for 2014 include:

The average sum paid to critical illness customers was £73,120.

The average age of critical illness customers was 46 years for women (45 in 2013) and 49 years for men (48 in 2013).

Cancer remains the most common cause of critical illness claims at 65% (down from 67% in 2013), followed by heart attack (12%), stroke (7%), multiple sclerosis (4%) and total permanent disability or ‘TPD’ (3%).

Louise Colley, Protection Director at Aviva says: “Our latest figures are reassuring for all families who have protection products with us. No one ever wants to claim against this type of policy, but knowing that we are committed to paying claims wherever possible provides families with the reassurance and comfort they need if the worst does happen.

“Almost 40,000 families have benefitted from payments in the last three years, with payments totalling more than £1.5 billion. Our commitment to our customers is simple, and remains the same as always, we will continue to enhance our protection products whilst making the claims process as quick and straightforward as possible.”

For the full press release visit www.aviva.com/media/news/item/uk-aviva-protection-customers-consistently-receive-over-half-a-billion-pounds-in-claims-each-year-17468

Mortgage News.

Market Harborough goes live.

HomeLoan Partnership is delighted to announce the appointment of Market Harborough Building Society to its panel. The Market Harborough Building Society looks at mortgages on an individual basis searching for solutions to unique cases that are often turned down by other lenders. The Society does not rely on a computer to make an automated decision of the mortgage case, preferring to leave the decision to a highly trained team of experienced knowledgeable individuals- providing a personal service sometimes missing with larger Banks and Building Societies.

At the Market Harborough Building Society every mortgage application is treated individually. They don’t feed your clients’ details into a computer; instead, make all the decisions themselves and give you a Decision in Principle within 48 hours. Applications are manually underwritten and dealt with by their team of specialists who ensure everything runs smoothly and quickly. Their mortgages cover properties throughout England and Wales.

Omega Secured Loans joins with an exclusive Buy to Let.

HomeLoan Partnership have added Omega Secured Loans to our panel, cementing further the established relationship with Omega that already exists through the current Commercial Mortgages offering.

Omega have been part of HomeLoan Partnership’s panel for several years, offering Commercial Mortgages since 2009, and we are delighted to be expanding our relationship with them to include Secured Loans. As you know, Secured Loans now form part of the client review process, so the Omega team can help you meet your requirements in this respect with their free initial no-obligation advice and terms available across both the Commercial and Secured Market.

Business Protection.

L&G have just published their brand new 2015 business protection research “State of the Nation’s SME Report”. To download a copy click here.<.p>

And finally…

Tell me why you want this job?

Questions about jam and role-playing games involving werewolves top the list in the worst ever questions asked of candidates in job interviews.

Workers have opened up to a UK employment law consultancy about interviews that either left them cringing or stamping out of the room in fury. Questions and strange requests have included:

“If you were a jar of jam, what flavour would you be and why?”

“We’re going to do some role-play now. You’ll be playing the part of the werewolf.”

“Not so much a question, but they got all the candidates together for a dance-off ‘to see which one of us is the best around other people’. It was for a supermarket cashier job.”

“Do you know First Aid? Have you got a certificate? We haven’t got any first aiders and we’ve got a health and safety inspection coming up.”

“Your CV says you speak French. How much do you think your language skills will be worth when Nigel pulls us out of the Common Market?”

“I went for a job for a New York-based company. It was a phone interview, and the American guy asked if I knew a David from London, as if we all know each other. I said yes, and promised to pass on his regards.”

Prospective employers have been warned about the risks they run in asking the wrong questions of candidates, luckily the phrase “You’re fired” isn’t on the list.

Rising Stars and Annuity Offset?

So we now have the final budget of this Parliament to digest and interpret – especially for those of us in the mortgage industry. A new Help to Buy ISA for first time buyers and a transfer for child trust funds was heralded by the Chancellor as revolutionary but should we be congratulating a “Rising Star” from the Leeds Building Society instead?

Cast your mind back to November when the CML invited entries based around the theme “If I could change the mortgage market, I would….” and four shortlisted candidates were invited to present their ideas to the CML Annual Conference. A panel consisting of CML Chairman Stephen Noakes of Lloyds Banking Group, CML director general Paul Smee, and Market Harborough Building Society chief executive Mark Robinson voted for Michael Rhodes’ entry who proposed a new style of tax-incentivised savings scheme. A scheme designed specifically to enable parents and grandparents to help children from birth accumulate part of the funds that would enable them to bridge the deposit gap later in life when they wished to buy a home. And now we have one! A rising star indeed – it won’t be long before service desk manager Michael is sitting in the Treasury.

But what of the decision to allow pensioners to sell on their annuity to a third party, we’ve got a TEP, perhaps we’ll also have a TAP. So if you are looking to sell an endowment and an annuity together, it will be a TEPATAP – one for the plumbing industry to get their head round. The question is how long will it take for the interest-only mortgage holders be offering to offset their 5% annuity against a 4% mortgage product? Are lenders going to be in the market to buy annuity funds in the knowledge that, assuming that the pot is big enough, they have the income coming in to repay a monthly mortgage commitment. Will we see the start of medical underwriting appearing at the retirement date of a mortgage holder to assess the potential length that the “annuity offset” may be available? With so many people now having an asset that was up to now non-negotiable, the market for those with a pension pot to carry a debt into retirement should really open up.

Interesting times as the financial services industry comes to terms with the changes in the budget – can savings systems work without deducting tax, the impact of increased bank levies on pricing and profits and will the ISA be as attractive now the first £1000 of earned interest is tax free. And that’s on top of changes to European legislation due in 2016. Who is the real winner out of the budget – well certainly Michael Rhodes and probably all those self-employed project managers who’ve just seen their contracts extended.

Neil Hoare, Commercial Director

UK Budget 2015 Summary.

In his final budget before the Election, here’s a summary of some of George Osborne’s key announcements. If you want to read the full report you can find it on-line here.

UK growth 2014.

The UK economy demonstrated strong annual growth when compared to other G7 economies in 2014. At the end of last year, employment had reached its highest ever level with unemployment falling in every region across the UK.

Inflation is at a record low, as announced by the Bank of England, but the Chancellor highlighted that risks still remain and there is more to do to support businesses and improve productivity.

Tax-free personal allowances set to be increased in April 2017, to £11,000.

The tax-free personal allowance – the amount people earn before they have to start paying tax – will rise to £10,800 in 2016-17, and £11,000 the year after. According to Treasury figures the increases to the personal allowance from £6,475 in 2010, to £11,000 in 2017-18 will have saved a typical taxpayer £905 in tax.

Higher Rate Tax payers will see an above inflation increase of the point above at which they fall into the 40% tax bracket. It will increase by £315 in 2016-17, and by £600 in 2017-18 – taking the starting point to £43,300 in 2017-18.

A new Personal Savings Allowance.

From April 2016, a tax-free allowance of £1,000 (or £500 for higher rate taxpayers) will be introduced for the interest that people earn on savings. If you are a basic rate taxpayer and have a total income up to £42,700 a year, you will be eligible for the £1,000 tax-free savings allowance.

For higher rate taxpayers earning between £42,701 and £150,000, you will be eligible for a £500 tax-free savings allowance.

Introducing the Help to Buy Individual Savings Account (ISA).

In the past 2 years the government has launched a number of schemes designed to help people to buy a home with just a small deposit.

The government is now going further to help first time buyers by incentivising saving for a deposit. The Help to Buy ISA will allow people to open a tax free savings account to save towards their first home, and the government will add a further 25% of the money deposited. That could mean up to £50 for every £200 people save, up to a maximum of £3,000.

ISA Reforms.

The rules for using an ISA to shelter your savings from tax are being reformed. Instead of being able to put up to £15,240 in the 2015-16 tax year into an ISA in total, people can take out their money and put it back in within the same year, without losing their ISA tax benefits – as long as the repayment is made in the same financial year as the withdrawal.

No fuel duty increase scheduled for September.

Since 2011, fuel duty has been frozen which, according to treasury figures, will have saved a typical motorist a total of £675 by the end of 2015-16. By the end of 2015-16 fuel duty will have been frozen for five years, resulting in the longest duty freeze in over 20 years.

Cutting beer duty.

There will be a reduction of one pence in duty from a pint of beer, 2% off spirits and most ciders, and a freeze on duty on wine.

Annuity reforms.

In a move which will create a second hand annuity market similar to that for endowments, from April 2016, people who already have an annuity will be able to now effectively sell it on.

Currently, people who have bought an annuity are unable to sell it without having to pay at least 55% tax on it. From April 2016, the tax rules will change so that people who already have income from an annuity can sell that when they choose and will pay the rate of tax they pay on income at the time of sale, instead of the 55% currently applicable.

Farmers to average their profits for income tax.

The period over which a farmer can average out their profits has been extended from two to five years. Farmers typically have volatile profits due to uncontrollable factors such as the weather, consumer habits or market forces.

The annual tax return to disappear.

Millions of individuals will have the information HMRC needs automatically uploaded into new digital tax accounts. The Chancellor has stated that most of the information needed will be automatically received cutting down the administration costs of a business.

The banking levy to increase.

The government is increasing the rate of the bank levy (one of the taxes that banks pay) from 1 April 2015. This levy has been in place since the financial crisis.

Faster broadband.

The government is investing up to £600 million to deliver better mobile networks, and is announcing a new ambition that ultrafast broadband should become available to nearly all UK premises.

HLP appoints Market Harborough Building Society to its panel.

HomeLoan Partnership is delighted to announce the appointment of Market Harborough Building Society to its panel.

The Market Harborough Building Society looks at mortgages on an individual basis searching for solutions to unique cases that are often turned down by other lenders. Their mortgages cover properties throughout England and Wales and the Society does not rely on a computer to make an automated decision on the mortgage case, preferring to leave the decision to a highly trained team of experienced knowledgeable individuals- providing a personal service sometimes missing with larger Banks and Building Societies.

Christopher Tanner, CEO of HomeLoan Partnership comments “We are always looking to enhance our panel with lenders who can offer solutions to customers whose financial circumstances need an expert underwriter to make a decision rather than a machine. We believe that the addition of Market Harborough Building Society will prove to be a valuable option for our members looking to deliver good customer outcomes.”

Mark Robinson, Chief Executive of Market Harborough Building Society comments “we are delighted to be working with HomeLoan Partnership, a company that has a similar ethos to ours. Together we will work closely to ensure the applicant’s needs are addressed quickly and professionally adding a tangible value to what is already a formidable and professional offering by HomeLoan Partnership.”

Robinson continues “These are exciting times to be involved in the mortgage market, and I’m sure that this partnership will lead to mutual success throughout 2015 and beyond.”

About HomeLoan Partnership:

HLP was founded by an affiliation of mortgage packager in 2000 to provide regulatory support to their broker base as the MCCB started to impact on previously unregulated firms.

In 2004 on the run up to full FSA mortgage regulation, 51% of the HLP was purchased by Mortgage 2000 (part of the Money Supermarket Group) and HLP became a regulated mortgage network.

In 2006 Christopher Tanner (Current CEO of HLP) David Franks & Bill Blevins (formerly of the Blevins Franks Group) purchased the majority shareholding in HLP and it has been under the same ownership since this date. This independence from corporate investment and influence has allowed HLP to determine its own future for the benefit of its customers and members alike.

About Market Harborough Building Society:

Market Harborough Building Society was established in the south Leicestershire town of Market Harborough in 1870. The Society has grown steadily and prudently over the last 145 years with assets in excess of £400m, over 52,000 savings customers and 5,500 mortgage customers.

Weekly Round-up, 13th March 2015.

Crystal ball.

The British Chamber of Commerce (BCC) has this week upgraded its forecasts for the UK with the headline that UK GDP growth forecasts will rise a little to 2.7% for 2015 & 2.6% for 2016. In 2017, which is included for the first time in their forecast, the BCC expects GDP growth of 2.6%. The upgrading of our GDP growth forecasts mainly reflects higher growth than they previously predicted in household consumption and in services output.

Consumption & services output will be the main contributors to growth in the next few years according to the BCC , the rationale being the stimulatory effects, global as well as domestic, of lower energy & food prices; and the prospect that interest rates will remain very low for longer than previously predicted.

Predicting the future is a challenge as demonstrated last year; full-year growth in 2014 was 2.6%, rather than the 3.0% the BCC predicted in December. They highlighted that the ONS downgraded its earlier estimates for the first two quarters of 2014, and quarterly GDP growth in Q4 2014 was only 0.5%, less than expected.

The UK unemployment rate is forecast to fall from 5.7% in Q4 2014, to 5.2% in Q4 2015, 4.9% in Q4 2016 and 4.8% in Q4 2017; and pressures for an early rise in UK official rates have faded. The BCC is expecting the first increase in the Bank Rate, to 0.75%, to occur in Q1 2016, two quarters later than previously forecast. Further modest increases in official interest rates can then be expected, in small 0.25% steps, with official interest rates reaching 1.00% in Q4 2016 and 2.00% in Q4 2017.

Modest growth.

According to the latest Halifax House Price Survey House prices in the three months to February were 2.6% higher than in the preceding three months. This measure of the underlying rate of house price growth increased for the second consecutive month in February despite a small monthly fall in prices. Annual price growth nonetheless eased, from 8.5% in January to 8.3%, and is comfortably below last July’s peak of 10.2%.

Commenting on the figures, Martin Ellis, housing economist for the Bank said:“ The firming in price growth shown by the recent pick-up in the three month-on-three month comparison and indications of a modest rise in activity are likely to be due to a boost to housing demand as a result of increases in real earnings and spending power, further recent falls in mortgage rates and stamp duty changes.

“The supply of both new and secondhand homes available for sale remains low; another factor that is likely to be supporting house prices. Supply remains tight despite house building in England increasing for the second consecutive year in 2014 and a recent rise in the number of properties coming on to the market.”

Time sensitive.

Time-poor people around the UK risk rushing important long-term decisions, with nine out of 10 (90%) regretting rushing their career choice and 87% feeling regret over hurrying financial decisions, new research from Scottish Widows has revealed.

The study into managing time and life admin priorities found that people in the UK are becoming busier: 70% feel more pushed for time than they did three years ago, with a quarter (25%) rarely or never having spare time and 26% feeling guilty if they ever do find themselves with time on their hands. The poll of 2,010 people aged 21-65 showed seven out of 10 adults (69%) feel day-to-day tasks have become increasingly time-consuming over the past three years and highlighted how people are managing potentially life-altering tasks as a result.

More than a third (36%) admitted life admin– including financial planning, researching money-saving opportunities and banking – is their biggest time-stealer. Meanwhile, family responsibilities are also increasingly consuming schedules, with 77% of respondents spending more time on childcare duties and caring for the wider family (81%) now than three years ago.

According to the study, half of those surveyed have a personal to-do list, increasing to 70% among 26 to 35 year-olds. The research found that the most popular time to tackle to-do lists is on a Saturday morning in the living room. These “Saturday Morning Pyjama Planners” are more time-aware than most as only 15% of the overall respondents are setting time aside to complete their lists.

The poll revealed tasks linger on our to-do lists for an average of nine weeks, with almost half (44%) admitting there are tasks every day that they never get to. A fifth of us blame social media as a distraction getting in the way of to-do lists and a further 20% claim lack of motivation prevents them from completing life admin. Family is the biggest diversion for 15% of those asked, while personal emails (18%) and online shopping (11%) are among the most common to-do list gate crashers. Housework topped the poll for taking up the most time outside of work according to 63% of those surveyed, while home improvement (40%), cleaning (35%) and paperwork (33%) were the most commonly put off household tasks.

Hidden at home.

The cancer charity Macmillan has released a report called Hidden at Home – which reveals that one in 10 (11%) people with cancer in the UK, equivalent to at least 160 000 people, say they are constantly or often left housebound due to a lack of support. At least 100 000 people (7%) are constantly or often unable to wash themselves, dress or go to the toilet.

The research provides for the first time a full picture of the widespread social care needs of people with cancer, with around two thirds (64%) having practical or personal care needs. The charity claims there is growing public acknowledgement that many people living with long term conditions need social care and too often they are inadequately supported. These findings reinforce this consensus but show that people with cancer are not an exception.

The charity report highlights that the lack of support for people with cancer does not only leave many housebound but is also putting people’s health at risk. One in seven (15%) people with cancer have had to go to hospital for an unplanned or emergency visit because of a lack of support for their practical or personal needs.

Macmillan says there are a number of reasons why people living with cancer do not always get access to formal social care support when they need it. These could include not enough support being available from local councils or the NHS (or health and social care trusts in Northern Ireland), people not being aware of what support is available or thinking they might not be eligible to receive it.

The report also shows how much people with cancer, and the health and social care system, rely on care provided by family and friends. For half of those with practical or personal support needs, care from family and friends is the only help they get, and half of those who provide informal care do not receive any support themselves.

Macmillan Cancer Support, Hidden at Home – the social care needs of people with cancer, 2015. Research methodology: Macmillan commissioned MRUK to conduct a comprehensive study of the issue comprising of:

• A UK-wide survey of 1,037 people living with cancer and their carers (209 people in treatment, 573 people with cancer diagnosed up to 10 years previously, and 255 current or recently bereaved carers of people at the end of life)p>

• 24 in-depth face-to-face interviews

• 15 week-long online diaries

And finally…

Arresting behaviour

Police are investigating a complaint that a 10-year-old girl was told drawing a hopscotch grid on the pavement outside her Ramsgate home was criminal damage.

The girl’s father, Bob Allen, who runs a karaoke business, contacted the police after the incident which he said left his daughter Lilly-May frightened.

He said: “The policeman said to her that what she had done was criminal damage and she could be arrested. He then drove off. “She didn’t come into the house for a while and didn’t tell us straight away because she thought I was going to tell her off for being naughty.”

A police spokeswoman said: “We are trying to trace the officers who are reported to have made this comment. From the circumstances described, it would not appear to have been necessary to advise the young girl that chalking a hopscotch grid may be criminal damage and illegal.”

Children in the county are also concerned about being accused of littering by leaving old jumpers on the ground whilst they play football, damaging curb stones through the wilful use of shins and knees, and causing undue stress to poor earth worms who were simply going about their daily business.

Protect loved ones, and perhaps those not so loved anymore.

The announcement this week by one distributor that it will expect its members to have Income Protection in place or have to be able to explain why they don’t need it before the can be appointed as an adviser has thrown the debate on the UK consumer’s attitude towards protection back in the spotlight. The move coincided with research from HSBC that the proportion of households that now have the protection against sickness and unemployment for their monthly income has fallen by a quarter to 9% in the past two years. Has the UK population got too used to connecting payment protection with income protection, and put them both in the miss-selling pot?

It’s interesting that we don’t see income protection as a cornerstone of family planning and even divorce planning. For many consumers we still promote the joint policy, decreasing term with a little CIC on the side, even though we know that the statistics have the same resonance between getting cancer and becoming divorced. Legal separation has been in the news as well with spouses claiming that income is owed from successful businessmen long after they have parted company but how many bread winning individuals in the UK seek to protect their payments to a spouse with income protection insurance should they suddenly find themselves unable to generate the maintenance payment. Why isn’t “maintenance protection” made mandatory as part of the settlement agreement? If we could all see how rocky our future path to financial security both in and out of love, then the role of the protection adviser would be a lot easier. We say protect our loved ones but should we also have the same for the not so loved anymore?

The seven families campaign has given the industry a real focus on the need for protection planning especially at a time when customers are making significant lifestyle changes or performing a real drains up review of spending habits. It’s up to us in the industry to support the efforts of the executive team of 7families and keep highlighting the need for both income protection and all the other fantastic benefits that Insurance companies have developed over the past few years. If customers knew about helplines, get fit incentives, 2nd opinions, rehabilitation, and everything that makes an insurance policy booklet the war and peace thickness that it is today, then the UK would be a more protected place.

Neil Hoare, Commercial Director

HLP adds Omega Secured Loans to panel.

HomeLoan Partnership have added Omega Secured Loans to their panel, cementing further the established relationship with Omega that already exists through their Commercial Mortgage offering.

With the Financial Conduct Authority now regulating the secured loan market, it is no surprise that Mortgage Market Review principles are now being replicated for lenders and master brokers in this sector of the market. It’s important that, as a Network, we ensure our members have expertise and competitive products to call upon when they find a secured loan is appropriate for their customer. Omega Secured Loans offer a professional and experienced service which will prove invaluable in meeting customer needs.

Christopher Tanner, CEO of HomeLoan Partnership comments “Omega have been part of HomeLoan Partnership’s panel for several years, offering Commercial Mortgages since 2009, and we are delighted to be expanding our relationship with them to include Secured Loans. As you know, Secured Loans now form part of the client review process, so the Omega team can help you meet your requirements in this respect with their free initial no-obligation advice and terms available across both the Commercial and Secured Market.”

Mark Jones from Omega said “We are delighted to announce continued growth of our relationship with HomeLoan Partnership, and are very excited by this expansion, adding our Secured Loans team to the existing Commercial and Specialist Finance arrangements. We will continue to offer a bespoke service tailored for every introducer, each deciding their own level of involvement without impacting on their potential to earn additional income across both Commercial Mortgages and Secured Loans.”

Building houses, building majorities.

We’ve seen politicians in the lead up to the election put housing firmly in the spotlight focussed on the strapline “build and build and build for a better Britain”. If you are green its, wait a minute, wait a minute, oh yes half a million of new social housing by 2020, if it’s the Tories then, for one night only, it’s 100,000 for a coalition or 200,000 for a Tory government (making you wonder whether any out of work liberal democrats will become bricklayers to help bridge the gap.) Labour have already got the 200,000 number in their sights by the end of the decade but will go one step further by introducing regulation in the private rental sector. The objective of the party is to provide more security for tenants by legislating for rights to longer term lets and predictable rents, unfair charges regulating letting agent fees. With research from the University of Oxford suggesting that the population of England has risen by 565,000 because of immigration, you have to question whether the current housing plans go far enough.

The great Buy to Let Debate this week threw up a number of questions for the private rental sector and highlighted the growing importance of the sector, especially when you consider there is reported to be an additional million students going to Universities this year. Labour is suggesting 3 year tenancy agreements to help tenants enjoy some level of security, but how will this affect the market. We have yet to see the impact of pension reforms in April on the Buy to Let sector, how many people over the age of 55 will choose property over an annuity? The introduction of a 3 year tenancy agreement could go either way for new annuity replacement landlords, 3 years income or your investment locked away with no chance to review. I’m waiting for the first rental yield vs annuity rate comparison engine to appear, and expecting that having a regulated letting agent managing your property to become a key element of buy to let mortgage lending criteria should labour win in May.

Based on the fact that demand for property will challenge politicians thinking for the next 5 years and beyond, the question is how the balance between home ownership and private rental can be maintained? Landlords will want to build portfolios and increase income, government want to increase home ownership and social benefits it brings. One suggestion would be for the Industry, regulator and government to adapt to the challenge of helping tenants become home owners by redefining the first time buyer. Applying a broad brush approach to affordability, income multiples and deposit availability doesn’t differentiate a first time buyer with no experience of running a home, to a tenant who has had experience of managing a property for a few years. The former needs the help, the latter just needs to convert their rent into a mortgage. Surely there is a journey we can follow to incentivise landlords to take tenants with a view to using rental as a proving ground for home ownership for example seeing a positive letting agent report on a tenant becoming an important piece of evidence for a first time buyer application.

The political parties are lining up to put housing as a battleground, so now is an ideal opportunity for the industry to influence thinking for at least the next 5 years.

Neil Hoare, Commercial Director