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End Of An Era


Last week was a mish-mash of contrasting news headlines that look like continuing into this week. Whilst events in the Middle East and talk of an oil crises overshadows much of the news, the revelation that the UK economy actually performed even worse than first thought in the last quarter may delay the impending rate rise by one month, at least until the next quarters figures are released.

I’m still betting on a rise by May and happy to take wagers!

Meanwhile, today really is an end of an era as the last boss of the largest UK banks who was in charge when the financial crises hit ends his tenure. Eric Daniels, Chief Executive of Lloyds Banking Group officially hands over to former Santander supremo Antonio Horta-Osorio tomorrow and Mr Daniels will be forever defined as the guy who “saved”, (for want of a better word) HBOS.

With all the major banks now under new “management” after this latest results season is over, hopefully they are now looking forward to a more stable future. The results that have been announced from some of the major banks show a welcome return to profit as well as some controversial bonus payments. Whether you agree with the bonus awards or not this is good news for the property sector as new housing has always topped the list of favourite ways to spend a bonus and this year should be no exception.

Whilst property at the top end may see a minor flurry due in part to this, there is also the small matter of a stamp duty change to come in April for all properties over £1,000,000. This movement from 4% to 5% should spur on potential buyers and in turn hopefully free up some stock further down the chain.

At this end of the chain there has been some good news today that Northern Rock are about to launch back into the 90% Loan-To-Value, (LTV) market. Whilst it is becoming easier to finance the larger mortgage loans, those without a substantial deposit have continued to struggle.

Another entrant returning to higher LTV’s provides welcome competition and shows that there is a modicum more comfort at this level. All we need are more lenders to follow suit and hope that this results in some more realistic pricing.

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