Property Market Trends - Mortgage Bonds

There are signs of life returning to the property market, or green shoots (the new media buzz word). With the falling interest rates and the easier entry into the market (lowering of deposit requirements) there has been renewed interest and we are starting to see an increase in sales.

The banks had taken the opportunity of a quiet market to renegotiate their contracts with the bond originators and it seems there has been a power shift from originators (squeezing the bank's rates to as low as 4% under prime) to the banks dictating rates of up to 4% above prime.

Since 2005 the banks have steadily lost business to the originators, as the chart below shows the banks hardly granted any bonds (directly to customers) by end of 2008. This gave the originators the upper hand and they also squeezed the banks for commissions of up to 2.5%, which resulted in the banks paying the originators billions per year! These billions ultimately came from customers in fees and charges.

The banks have now renegotiated the originator's commission down to around 1.5% and are aggressively encouraging clients to approach them directly for bond finance at a rate lower than the originators can negotiate.

I hope that once the banks start feeling the benefits of the increase in revenues from interest rates above prime and lower commissions to originators they will give some back to their clients in the form of lower bank fees and also in lower bond rates!

Remember all these costs were shifted on to us as consumers in the form of admin fees and bank charges!

Source: Financial Mail

Property: House up for grabs in Sudoku competition

Struggling to sell your house?
I found this article on the Internet and I do believe it is true and I also think it is legitimate, I am just not sure what the legal requirements are for foreigners to buy property in the UK and would advise any foreigners to first inquire before spending the £50.

A 49 year old finance broker, Dave Mackie from Hambleton near Blackpool, is looking to raise £700,000 by getting 14,000 people to enter the Sudoku raffle for £50 each. The money collected in entry fees would subsequently cover the value of the three-bedroom property, which stands at £675,000, plus £25,000 worth of advertising and legal costs. The winner, who will be picked from the entrants who complete the online Sudoku puzzle, will be announced in February 2010, or when 14,000 people have entered the competition.

He/she will then be awarded the prize of the detached red-brick property, which is situated in large grounds on the Lancashire coast. The home, located on the banks of the River Wyre, boasts landscaped gardens to the front and rear, two balconies, three bedrooms, four bathrooms, a sauna and a steam room. The lucky winner will also be able to rent a river mooring if they wish to do so.

Mr. Mackie said: "There's no catch. I'm looking to retire abroad and the time has come to move on. I thought this was a fun way to get rid of the old house and beat the credit crunch." Mr. Mackie admitted that he is a puzzle fanatic himself, before going on to explain that because he will be 50 later this year, he felt it was time to review his life. "I have properties in Egypt and have considered living there for some time," he said. "I don't believe anyone has ever set up a Sudoku competition to sell their home. This way everyone's a winner. The lucky person gets the house free from any mortgage and I get its market value."

Mr. Mackie bought the house back in the mid 1970s. In 2008, he installed new windows and built two balconies, a sauna and a steam room, at a cost of £200,000. Anyone looking to enter the competition for a chance to win the property needs to visit http://www.win-free-home.com, solve the Sudoku puzzle, and pay the £50 entry fee. Entrants will then receive a unique entry number.

All entrance fees are being held in a bank account which has been opened specifically for the competition, and will be independently audited. If 14,000 people have not entered the raffle by February next year, one of the entrants will be awarded the competition fund as a cash prize.

This is the most imaginative way of selling your house I have come across! I am hooked on Sudoku and must say I am very tempted!

Please leave a comment if you decide to enter this competition.

Source: PropertyIndex.com