Finance Matters

Posts Tagged ‘Scotland’

Mortgage lender the Halifax claims that house prices fell by 1.3 per cent last year to an average of £160,063, their lowest level since July 2009.

According to the Halifax House Price Index, house prices fell 0.9 per cent in December, compared with the previous month.

Although prices rose in the third quarter of 2010, they fell by 0.1 per cent in the fourth quarter, offsetting the earlier quarter’s increase.

The bank expects prices to be stable throughout 2012 unless the economy falls into another recession.

The report contradicts earlier figures from Nationwide, which suggested that house prices rose by 1 per cent in 2011.

Property prices have plummeted since the onset of the credit crunch, with banks and building societies exercising extreme caution over lending, making mortgages very difficult to obtain, especially for first-time buyers.

Recent research by property valuation website Zoopla suggests that some regions have fared significantly better than others when it comes to property prices.

Zoopla recorded an overall fall in UK house prices last year, but an increase of nearly 7 per cent in Scotland, where the average house now costs £164,844.

Zoopla’s research suggests the average house price in Britain is now £221,331, significantly higher than the Halifax’s figure of £160,063.

According to Zoopla the average price in England fell 0.75 per cent in 2011, to £228,926, whilst the average price in Wales fell 0.1 per cent to £153,826, compared with 2010.

Zoopla also reported a widening of the north/south divide in England, with house prices rising in London and the south-east, but falling in the north.

It suggests the average house price in London, where demand for property is high, increased 2.3 per cent last year to £416,890, while prices fell 5.8 per cent in north-east England to £156,659.

Mortgage lending in Scotland rose by 8 per cent in the third quarter, with the number of loans increasing to 12,400, 900 more than in the previous quarter.

However, the rate of growth was much lower than for the UK as a whole, where mortgage lending increased by 16 per cent.

The data, from the Council of Mortgage Lenders Scotland, also revealed a 7 per cent increase in the number of loans advanced to first-time buyers in Scotland in the third quarter, to 4,600.

In terms of value, loans to first time buyers in Scotland grew 10 per cent compared with the second quarter, to £429m.

Again, this represents a significantly slower rate of growth than for the UK as a whole, where loans to first time buyers increased 13% by volume and 16% by value.

Kennedy Foster, policy consultant at CML Scotland, said: “The uncertain economic outlook and low levels of consumer confidence will likely result in a continuing constrained mortgage market in Scotland as in the UK in general.”

New figures released by the British Bankers Association (BBA) suggest that although mortgage lending is increasing, the market is still subdued, with prospective house buyers remaining cautious due to the current economic environment.

For October 2011, the BBA recorded gross mortgage lending of £8 billion, an increase of four per cent compared with October 2010.

The average value of a mortgage remained stable in October compared with the previous year, at around £145,000, but mortgage approvals were 16 per cent higher compared with the previous year.

BBA’s statistics director David Dooks said that the mortgage market “remains subdued and demand for unsecured borrowing is slow, reflecting householders’ caution in the current economic environment.”

New figures from Sainsbury’s Bank suggest that nearly two million credit card holders intend to switch providers over the next year, when their 0 per cent balance transfer offer expires.

A further 900,000 card holders will switch when their 0 per cent purchase deal expires, according to the bank’s latest research.

After the introductory offer on these cards ends, the percentage rate charge rises to 18.2 per cent on average while the APR on new purchases rises to around 18 per cent, so it’s hardly surprising that customers chose to move their business elsewhere.

There are several cards offering a much more competitive rate including Sainsbury’s card at 6.9 per cent and Barclaycard at 7.9 per cent, while many customers are likely to take up a new 0 per cent balance transfer deal.

However, significantly fewer people will be using a credit card to pay for Christmas this year, according to new research by Legal & General.

Around a third of households paid for Christmas with credit cards last year, but this number is expected to drop to a fifth this year.

With increasing pressure on household incomes coming for all directions, a third of households are planning to spend less on gifts this year, according to the Money Mood survey of 1,000 adults.

Sixty-seven per cent said they had enough money put aside for Christmas, while in the London and West Midlands, just 60 per cent of people said they had enough money saved for the festive season.

People in the north of England are the best prepared, with 79 per cent saying they had saved enough money to pay for what they need, while in Wales and Scotland the figures fell to 72 per cent and 68 per cent respectively.

As expected, ash cloud has drifted over Scotland from Iceland’s Grimsvotn volcano, resulting in flight cancellations. The volcano, which erupted over the weekend, is the second in just over a year after the volcano located under the Eyjafjallajokull glacier about 100 miles east of the capital Reykjavik, led to flight cancellations last year. It forced [...]

Scotland’s economy shrank less than thought in the October to December period, official figures revealed today. GDP was revised upwards to a contraction of 0.4% rather than an earlier estimate of 0.5%. The contraction was attributed to the bad weather during the quarter which impacted on many businesses. On an annual basis, meanwhile, the economy [...]