Weekly Round-Up: 11th November 2018

Softly Softly

London StreetAccording to the latest analysis by the Halifax, the annual rate of house price growth has fallen from 2.5% in September to 1.5% in October, which is the lowest rate of annual growth since March 2013. However, this remains within the Lender’s forecast annual growth range of 0-3% for 2018 as prices continue to be supported by the fact that the supply of new homes and existing properties available for sale remains low. Further house price support comes from an already high and improving employment rate and historically low mortgage rates which are creating higher rates of relative affordability. Halifax see this continuing to be the case over the coming months and they remain supportive of their 0-3% forecast range.

HMRC have highlighted that, in the three months to September, sales were unchanged from the previous three months. The volume of residential transactions has been broadly flat over the past year and is likely to remain so in the coming months. Bank of England industry-wide figures show that the number of mortgages approved to finance house purchases – a leading indicator of completed house sales – fell by 1.3% month on month to 65,269 in September.

Finally respondents to the Royal Institute of Chartered Surveyors monthly UK Residential Market Survey continue to cite the mixture of affordability constraints, a lack of stock, economic uncertainty and interest rate rises as holding back activity to a certain degree. The lack of new instructions coming to market continues to impede activity and new instructions were down for the second consecutive month.

Don’t stand for it

Credit CardMore than 15 million people in the UK routinely miss out on refunds, replacement products and getting problems sorted because they don’t know how to complain with confidence, new research reveals. In a study for the Financial Conduct Authority (FCA), which is encouraging people to check if they were mis-sold PPI and make a complaint before they miss their chance, 28% of Brits admit they put up with situations including queue jumpers, sub-standard meals and poor service because they lack the confidence and know-how to speak out.

The study shows the art of complaining is at risk of dying out, with younger generations the least likely to be proactive about getting problems resolved or their money back. Less than half (46%) of 16-24 year olds would complain about bad service in a restaurant (versus 71% of over 55s) and 16-24 year olds wait for over a week, on average, to complain about an issue, whereas over 55s take 2.5 days to speak up.

The FCA’s research, launched to highlight the upcoming 29 August 2019 deadline for PPI complaints, also shows younger groups are the most likely to leave it too late to complain, with 25-34 year olds twice as likely as over 55s to delay so much that they miss their chance.

Different generations’ views on what it means to complain may be fueling complaining’s status as a dying art. Younger people are more likely to see it as critical and ‘causing a scene’ than their parents, who associate it more with empowerment – taking a stand or making a protest. Just two in five (44%) under 35s relate complaining to ‘getting a good deal’ versus 68% of over 55s. In contrast, more than a quarter (27%) associate it with ‘awkwardness’, compared to just 11% of over 55s.<\p>

Hitting the right note

Cash MachineDuring an event at the Science Museum to launch the character nomination period, the Governor of the Bank of England announced that the new polymer £50 note will celebrate the UK’s achievements in science.

Mark Carney said that that the new £50 will celebrate the UK’s contribution to science from a wealth of individuals whose work has shaped how people think about the world and who continue to inspire people today. The banknotes are designed to be an opportunity to celebrate the diversity of UK society and highlight the contributions of its greatest citizens. Members of the public have six weeks to nominate a historical character who has contributed to science and influenced UK society. They could have worked in any field of science including astronomy, biology, bio-technology, chemistry, engineering, mathematics, medical research, physics, technology or zoology.

The Governor has also announced the appointment of four experts in the field of science to the Banknote Character Advisory Committee – Dr Maggie Aderin-Pocock, Dr Emily Grossman, Professor Simon Schaffer and Dr Simon Singh. They will join the permanent members on the Committee in creating a shortlist from the range of characters put forward by the public. The Governor will then make a choice from the shortlist and the final decision will be announced in 2019 alongside a concept design for the new note.

Spotlight on General Insurance

Customer care webpage interface wordThe Financial Conduct Authority has announced the launch of a market study into general insurance pricing practices which demonstrates that Insurers must continue to emphasise the core value of Treating Customers Fairly, particularly when it comes to charges faced by customers both new and those demonstrating a level of loyalty. Focusing on two of the most commonly held general insurance products home and motor insurance, the market study is also set to expand the regulator’s emerging work on how insurers use data and information on personal characteristics to price policies across different groups of customers, and particularly those classed as vulnerable.

Alongside the market study announcement, the FCA has also published a discussion paper setting out its approach to considering fairness of pricing in general. Both publications are available on the FCA’s website and have received widespread media coverage, indicating the level of public interest in this topic.

The FCA’s announcement follows concerns identified during its supervisory work, and previous publications such as its July 2018 research note on price discrimination in financial services. The FCA has identified four key issues related to pricing practices on which the market study will focus on consumer outcomes; the fairness of outcomes; the impact on competition; and remedies to address any harm the regulator identifies. The information gathering exercise is due to conclude by the end of January 2019, with an interim report in the summer to be followed by a consultation on any proposed remedies by the end of 2019.

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