March « 2011 « Home Quote Direct

Archive for March, 2011

Firstbuy will appeal to potential homeowners

Thursday, March 31st, 2011

When Chancellor George Osborne sat down at the end of his budget speech a week ago, first time buyers looking to get on the first rung of the property ladder had some cause for cautious optimism. Within seconds of his first utterance of the new “Firstbuy” scheme, prospective home buyers were probably already dreaming of doing things that come naturally to so many of us. Things like organising household insurance, home loans and mortgage insurance. Lucky them!

Manageable deposit

The “Firstbuy” scheme promises to allow first time buyers a much easier route to owning their home. Instead of the average £25,000 deposit required to secure a mortgage at the moment, the scheme will demand just a 5% deposit, which will bring the £25,000 down to around £6,000-£7,000 a more manageable figure altogether. The scheme does have several qualification criteria wrapped around it though.

Equity loan will bridge the gap

First of all the “Firstbuy” option will only apply to new builds on specifically named projects. The scheme will allow the homebuyers to put down a 5% deposit and take out a loan to value mortgage for another 75% of the property cost. The remaining 20% will be loaned to the couple in a way not yet actually specified but will probably be a joint equity loan cobbled together by the builder and the Government. The equity loan will be interest free for the first 5 years and after that will gradually start to attract interest repayments.

The loan will have to be paid back when the house is eventually sold and it will not be a precise figure, but the same percentage of the sale price that the property owners borrowed to make the purchase. So if the homeowners took out a 20% equity loan they will pay back 20% of the sale price. This means of course, that if they make a profit on the sale then the Government/builder will get a slice of the profit too.

Experts split, but hopefuls won’t be

Experts are split over the benefits of the new scheme with some pointing out it is not actually as good as Labours “Homebuy” scheme launched 3 years ago. Whatever the experts think it is a safe bet that there will be plenty of takers for the scheme when it is launched later this year. Unfortunately the £210,000 million earmarked for “Firstbuy” will probably help only about 10,000 homebuyers. Many will be pleased to grasp the opportunity of looking at home insurance comparison sites for the first time but I can assure them the pleasure will soon dim!

Tags: first home, First Time Buyers, Firstbuy, George Osborne, Home Insurance
Posted in First Time Buyers | No Comments »

Adam Posen the right questions

Tuesday, March 29th, 2011

As homeowners across the UK try and digest what the latest budget offering from George Osborne will do to their domestic economy situation, one man who could have an even greater effect on their finances has better news to offer.

Stable base rate

As homeowners nervously calculate their monthly outgoings, from home insurance to home delivered fast food, the one constant they have had over the last two years has been a steady mortgage rate. It has been, for many people the difference between hanging on to their home and applying to join a Council house waiting list. The lowest ever bank rate since its inception in 1694 of 0.05 has kept the lid on the recession, it has been the difference in keeping home repossessions down to much lower figures than they were in other downturns over the last generation.

Inflationary pressures

The rate is now under more pressure than at any time in those two years. Inflation is now racing ahead at over 4% and with the promise of even dearer fuel and energy charges still in the aptly named pipeline, the hawks in the Bank of England Finance Committee are circling and screeching ever more loudly for an increase in the base rate.

Any increase in the base rate would be seized upon by bankers and mortgage providers alike. Within minutes of an increase being announced mortgage rates will be on the way up and no-one can help the poor old homeowner then.

Cometh the hour…

Well perhaps one man can. Adam Posen is a member of the Bank of England Finance Committee and he is far from convinced that a rise in interest rates is necessary. Indeed he sees several reasons why they should stay as they are and fortunately for many he is not shy about making them public. Posen believes that once the effect of fuel and energy prices have worked there way through the system, inflation will fall below the stated target of 2% by next year.

Time will tell

He says that the wait and see approach adopted by the majority of the committee will show that an increase in wages and wage demands which would really put pressure on the inflation pedal will not materialise. He believes the job cuts coming through will weaken Trade Unions enough to quell actions from the shop floor to back up wage demands. If the banker is right then homeowners across the country can breathe just a little easier and still afford to look around for good home insurance offers and perhaps even splash out on the occasional take away meal.

Tags: banks, Base Rate, Home Insurance, property market
Posted in Home Insurance | No Comments »

Pets attracting pests like never before

Thursday, March 24th, 2011

It is no secret that Britons are regarded as the most pet loving nation in the world, almost half of the homes in the UK harbour some sort of pet and according to recent research they may be harbouring other forms of life they will not be so keen on having.

Can I cover against pet damage?

A recent report by researchers at Bristol University revealed that Britain’s best loved pets, in the shape of dogs, were carrying far greater levels of pest infestation than was previously thought. Of course that also means that households across the UK will be home to the uninvited guests. In the past few years there has been a glowing clamour for household insurance companies to provide policies that cover pet owners from damage caused by pets, this latest report may well put paid to the chances of this happening.

Visitors from overseas

To make matters worse the researchers discovered that one of the ticks found on the pests was an invader from abroad. The foreigner was found to be prevalent in South East England and West Wales and is said to be a well known transporter of a number of diseases that can affect humans including Lyme’s Disease.

15% not up to scratch

The research involved the testing of over 3,500 dogs by over 170 veterinary surgeons, other interesting facts to emerge included that at any given time in the UK approximately 1 in 6 dogs were affected by ticks and fleas and that, unsurprisingly long haired dogs were more susceptible to infestation. Dogs in the South-West, East Anglia and parts of Scotland were worst affected by the pests but no region was “clean”.

Check with home insurance provider

Pet loving homeowners will know that there are many sprays and tablets on the market that promise to get rid of fleas and ticks on dogs, and that many sprays can be used around the house to stop the pests breeding. It is however, important that homeowners read carefully the instructions on the can and check with their home insurance broker on how it can affect their policy before going ahead and using it. The sprays can discolour carpets and furniture and may also leave an unpleasant odour in the atmosphere for a short time.

Tags: Contents Insurance, household insurance, pests
Posted in Advice for Tenants, Home Insurance | No Comments »

Homeless services revamp increases fears for residents

Wednesday, March 23rd, 2011

Homeless families in South East Birmingham will now face an extra long journey to try and find a roof over their heads after services in the city dedicated to helping the homeless have undergone a massive shake up.

The homeless advice service which has for a long time been first port of call for anyone finding themselves evicted or having their home repossessed in the city has now been squeezed into just 4 locations, Newtown, Small Heath, Northfield and Erdington, a radical change from the 20 offices dotted around the City previously.

Now the council’s housing watchdog committee have expressed fears that residents in areas such as Yardley and Acocks Green will be faced with several bus journeys to process their applications, and the worry is that some may give up or end up sleeping rough. The fear is some will become depressed at losing their home and will not make the long journey for help. Only once an application has been processed and accepted can temporary accommodation be issued and their name entered on the housing waiting list. Only then of course can they think about getting household insurance cover once more.

Lib Dem Committee Member Iain Bowen said “These offices are not very accessible for people from the south-east, in areas like Acocks Green and Yardley. There should be something there so people can see a homeless officer. People from my ward will need two or three buses to get to the nearest office.”

Council bosses insist the new system will be more effective with experts concentrated together rather than spread out in several neighbourhood offices. The council have also pledged to pay the bus fare, and in exceptional cases they will pay a taxi fare to get people to the office where they can be helped. The council are also planning to use homes formerly set aside for asylum seekers to help anyone who becomes homeless.

Tags: Home Insurance, Homeless services, household insurance
Posted in Home Insurance | No Comments »

OFGEM bares its teeth

Tuesday, March 22nd, 2011

The one definite plus energy customers can take from the OFGEM report on energy prices in Britain today is that home insurance comparison sites can save consumers considerable amounts of cash.

Too much choice, not enough information

The report roundly condemns the big players in the energy market for making their tariffs so confusing and for the sheer weight in numbers of the different tariffs and offers that are available to consumers. The report reckons that possibly only 10% of homeowners are on the best, most economic rate for their circumstances, with the rest of us having been bamboozled by TV adverts or cold callers knocking at our door. There are plenty of course who just can’t be bothered to change as it all seems so bewildering. And who can blame them. According to the report, OFGEM reckon there are around 300 different tariffs on the market for gas and electricity at the moment, which is over 60% more than there was less than 3 years ago.

Energy firms hit back

However, as always there are two sides to an argument and the energy providers are countering the claims by saying they are simply catering for the diverse needs of a population of more than 60 million souls. They claim that some customers are more interested in green issues than actual cost, whereas others want a fixed rate so that they can plan ahead. Others like to submit their own readings while others want to pay by direct debit. They say they are just giving consumers more choice.

Hard to understand

There is little doubt though that understanding an energy bill is more difficult today than ever before. It is certainly nowhere near as simple as say a home insurance guide. There are usually at least three different tariffs within one scheme with the first tariff commonly being the most expensive and then different tariffs introduced depending on the amount of energy consumed. Because of this low users usually find that they pay a lot more for their energy than those more profligate.

Will the report give me cheaper bills?

It is probably good for consumers that at last a watchdog is bearing its teeth but hopes that the result will be cheaper energy prices are too much to expect. All market observers reckon there is only one way gas and electricity prices are going and it doesn’t rhyme with blower!

Tags: Energy firms, Home Insurance, OFGEM
Posted in Home Insurance | No Comments »

Budgeting for bad news

Thursday, March 17th, 2011

As homeowners across the UK continue to try and balance their household budgets the impact of last year’s budget may take them by surprise next month.

Where should the money go?

With increasing unemployment affecting millions of families in every corner of Britain, and the rising fuel prices hitting even more families, many households already have to make hard decisions on where there money is spent best. Should it be a holiday or should it be household insurance. From a distance it may seem obvious but difficult choices are already being made in homes everywhere, next month things may get a lot worse.

Budget delays the bad news

The thing about budgets is that the true impact of them doesn’t kick in straight away, so while our TV screens are filled with financial pundits telling us exactly how things are going to affect us, Joe Public puts it to the back of his mind until the day is about to dawn. Any time now is that day, unfortunately.

Triple Whammy

It is estimated that 30 million workers in the UK will be affected by up to 45 taxes and benefit changes on April the 6th! The hardest hit will be the ones classed as “Middle England” as usual but the Institute of Fiscal Studies (IFS) reckons that on average we will be £200 a year worse off. The timing could not be worse, just as the increase in VAT and the most punitive taxes on fuel in the nations history hit us hardest we find our income tax bill is about to rise.

Income Tax is at the heart of most changes with the new top rate limit being brought down from £43,875 to £42,475. According to the IFS this will bring another three quarters of a million workers into the top rate of 40% income tax bracket. This will bring in more than enough cash for the Government to adjust the income tax entry wage from £6,475 to £7,475.

Other taxes

National Insurance contributions rise by 1% for everyone but those at the top end will pay even more. Child Benefit will not be increased at all, not just for this year but for the following two as well. Child tax credit will also be removed from the income of many families.

Other taxes are set to increase also including inheritance tax. Insurance tax increases will make affordable home insurance more difficult than ever to find. So when you hear the bad news from next week’s 2011 budget remember that you haven’t started to pay for 2010 yet!

Tags: household budgets, Middle England
Posted in Home Insurance | No Comments »

Cover for extensions should not be forgotten

Tuesday, March 15th, 2011

With the current well recorded difficulties experienced by homeowners across the UK when trying to buy and sell homes, the level of home extensions is soaring. Household insurance providers are encouraging homeowners who do decide to stay where they are and build, to check their policy covers the extra part of their home.

Under insuring is a big problem for insurance providers but an even bigger one for those householders when disaster strikes. A recent survey by home insurance providers found that many dwellers don’t realise the amount of value they are adding to their home when they extend.

Survey reveals shortfall

A poll of 1200 homeowners found some rather interesting and in some cases disturbing views on protecting ones assets. Over 700 of the 1200 questioned said they would not consider informing their insurance provider when they did home improvements and 1 in 4 said they were not aware that their insurance company had to be informed if they added extra rooms to the building or a conservatory.

The survey did confirm that householders frustrated by the stagnation in the housing market were upgrading their present home instead of moving on, with many viewing an addition of a conservatory as the easiest and simplest way of creating more space.

Bedrooms and bathrooms

Other popular additions to the home were the conversion of a garage into living space, the erection of a second garage and of course the favourite for those with no room to extend was the conversion of an attic into a bedroom. For others bedrooms were not such a priority and the conversion of a spare bedroom into a bathroom or en-suite came high up on the list.

Roof terrace high on the agenda

A newcomer on the home extension list is the roof terrace. This is becoming very popular in certain places in the UK and probably emanates from holidays spent in the Mediterranean and Caribbean where drinks and meals are taken outside as the norm.

Whatever you decide to do with your home remember that you are adding value to the property and therefore need to update your protection. This does not just include the value of the new space created, remember this space will include new soft furnishings and electrical appliances it is vital that your home contents insurance is up to the mark as well.

Tags: buy and sell homes, insurance providers
Posted in Advice for Tenants, Home Insurance | No Comments »

Policy updates vital for home insurers

Friday, March 11th, 2011

Homeowners across the UK are being advised to check their household insurance policies to ensure they are not underinsured.

A leading provider of home insurance said a survey carried out on homeowners showed that 65% of them only gave a cursory estimate of their contents value when filling out their application form. Others also deliberately undervalued their possessions thinking it would get them a cheaper quote.

The folly of under insurance is a concept that many homeowners still have to grasp. It may well save them a few pounds on their yearly policy and may still not affect them if they make a claim say for a carpet stain but if disaster strikes, and that is really the reason we insure our possessions, then they could be in for a big shock.

When disaster does strike the insurance assessor visits the property and gives his opinion of settlement. If the home is under insured then the insurance provider will reduce the settlement by the same percentage as the projected under insurance. The difference can be massive and can be a massive setback for those that have already experienced trauma through the loss of their home in the first place.

The survey also revealed that 1 in 3 of us never update out policies, which in a way is just like under insuring. The home we moved in to 20 years ago will not be the same as the one now. Perhaps a new kitchen and bathroom has been put in, a new conservatory or even a converted attic. All these things will add value to your home and require additional contents to be placed in it.

Insurance providers point out the folly of spending money on something that will not do the job they want it to do with John Kenny, a claims manager at the company, saying “There’s nothing worse than paying for something that won’t work when you need it most, unfortunately, people are unlikely to appreciate the value of insurance cover until they need to make a claim.”

Tags: home insurers, household insurance, Policy updates
Posted in Home Insurance | No Comments »

Shared ownership still an option

Thursday, March 10th, 2011

With the housing market still in a lethargic state, and mortgages on properties in the Capital seemingly only for those that don’t seriously have to think about getting a job to get by, where does the young professional or the young married couple, trying to make a living in London, turn to for decent accommodation?

Gazumping rears its ugly head

The news that gazumping has now been transferred to the letting sector must be a frightening prospect for the thousands of young people who flock to London to further their fledgling careers. The thrill of landing a job at a prestigious company is now being tempered by the fact that one cannot afford to live anywhere near their place of employment.

Shared ownership better than shared bills?

The rental sector is booming and rents are escalating almost month on month. To find a place of your own in and around London under £1,200.00 a month is becoming nigh on impossible, and for those that hate the thought of flat sharing and working out who owes what and to whom for the monthly home insurance and utility bills, then anything else is worth considering. A young reporter on a national newspaper recently investigated the options available to young professionals ensconced in London and found that shared ownership schemes, once the flagship, future answer to property affordability are still alive but not exactly a cheap option.

The idea of shared ownership has been around for some time and the idea is that people with aspirations of owning their own homes, be they single or couples, but not having the resources to raise a deposit big enough to purchase on their own, buy a percentage of a home with the builder of the property owning the rest. The scheme is designed with the idea that gradually the part owner has the resources to buy the remaining percentage from the builder although this is not compulsory.

Scheme fraught with danger?

Without doubt the idea is good but participants in the schemes do not find the outlay, especially in the early years, too easy to find. Although it is a shared ownership scheme, such things as repairs to the property and household insurance have to be found by the incumbent. This coupled with the fact that the owner is buying a house on the cusp of affordability means many of the arrangements are financially fragile.

The intrepid reporter found that an income of at least £40,000 a year was required for a quarter share of anything decent in Central London plus of course a sizeable deposit. The schemes though are by no way unpopular because the rental situation is so bad

Tags: Home Insurance, housing market, mortgages
Posted in Home Insurance | No Comments »

Stay put, lock up and bring down your costs

Tuesday, March 8th, 2011

As the credit crunch continues to bite, many homeowners have decided to put off moving home and decided to stay put. The ever escalating cost of living has not only put people off moving, it is making them more conscious of where they can make savings in the property they have. It is without doubt that savings can be made on a whole host of things, and one of these is definitely household insurance.

Compare your deal

Anyone spending a couple of hours watching TV will realise that home insurance comparison sites exist. They will also realise that some are spending quite a lot of money in competition with each other via adverts rather than substance. However, it really is a good idea to try and get a better deal than you already have.

Once you have selected an insurance company there are still other ways you can bring that quote down. It is of the utmost importance that you fill in your insurance application form honestly and to the best of your knowledge, but just by looking at the questions you will see how easy it is to bring your quote down.

Ways to bring down your home insurance

If someone is occupying your property day and night; for instance you are retired or work from home, then this reduces the risk of burglary, fire and flood and will bring in a cheaper quote. If you have a burglar alarm that has been fitted and maintained to a professional standard and you can prove it, then once again this should reduce your premium.

Window and door locks are another aspect of security that can bring down your costs. Questions on what sort of locks are on your doors can seem a little tricky and the best way to find out exactly what sort of security is installed in your doors is to ask the firm who fitted them, failing this a quick call to your local crime prevention officer will probably get you the information you need. The better the locks, then the cheaper the quote.

Pay up front and in bulk

You will usually save money by organising your home contents insurance and buildings insurance at the same time and with the same company, you will also save money by paying up front i.e. paying the full cost of the premium in one lump sum as opposed to paying by a monthly direct debit.

Tags: Contents Insurance, Home Insurance, household insurance
Posted in Advice for Tenants, Home Insurance, Home Security, Saving Money | No Comments »