London could be in for a real estate market boost after the city’s mayor announced a £5 billion windfall for housing.
Boris Johnson unveiled the Housing Strategy, which is geared to boost building in London during the economic slowdown.
Measures include support for the construction industry to get more affordable homes for sale onto the market.
The Greater London Authority also said the strategy would see cash used to kick-start some of London’s stalled developments.
Wednesday, November 26, 2008
Sunday, November 23, 2008
London property, through the looking glass
In 2006, our fixed-rate time limit ended and we once again had incentive to shop around. This time, my husband secured a new, interest-only mortgage after just a few simple phone calls. Our monthly payments would be even lower than before, though with this type of loan we would not be reducing the principal. Yet seeing that most mortgages are interest-only for the first few years anyway, it seemed a good option. And when we learned that the two-year fixed rate was just 4.59 percent, it seemed too good to be true.
Turns out it was.
This past February, Northern Rock - a bank that at the time accounted for one in five British mortgages, including ours - had to be bailed out by the government because it over-leveraged. The bank's demise left us staring at a whopping 6.8 percent interest rate if we didn't refinance by June. That meant our monthly mortgage payment would increase by more than a third.
Still, in spite of the difficult economic climate, we felt pretty smug about finding a new lender. My husband had just started a new and well-paid job; my freelance writing business was going strong; we had some savings in the U.S. stock market; and we only needed to cover half the value of our house.
Turns out it was.
This past February, Northern Rock - a bank that at the time accounted for one in five British mortgages, including ours - had to be bailed out by the government because it over-leveraged. The bank's demise left us staring at a whopping 6.8 percent interest rate if we didn't refinance by June. That meant our monthly mortgage payment would increase by more than a third.
Still, in spite of the difficult economic climate, we felt pretty smug about finding a new lender. My husband had just started a new and well-paid job; my freelance writing business was going strong; we had some savings in the U.S. stock market; and we only needed to cover half the value of our house.
Wednesday, November 19, 2008
British Land Reports Wider Quarterly Loss as Values Decline
British Land Co. Plc, the U.K.'s second-largest real estate investment trust, posted a second quarter loss after it was forced to write down the value of its shops and offices by 683 million pounds ($1.02 billion).
The net loss for the three months ended Sept. 30 widened to 747 million pounds, or 146 pence a share, from 277 million pounds, or 54 pence, a year earlier, the London-based company said today in a statement. The company's net asset value fell to 1,043 pence a share.
British Land, owner of the Broadgate estate in London's main financial district, is enduring the worst commercial property decline in at least 15 years. A freeze on bank lending has cut off credit to most property borrowers, exacerbating price falls. U.K. commercial property values are down 28 percent from their peak in June 2007, according to data from Investment Property Databank Ltd.
The net loss for the three months ended Sept. 30 widened to 747 million pounds, or 146 pence a share, from 277 million pounds, or 54 pence, a year earlier, the London-based company said today in a statement. The company's net asset value fell to 1,043 pence a share.
British Land, owner of the Broadgate estate in London's main financial district, is enduring the worst commercial property decline in at least 15 years. A freeze on bank lending has cut off credit to most property borrowers, exacerbating price falls. U.K. commercial property values are down 28 percent from their peak in June 2007, according to data from Investment Property Databank Ltd.
Friday, November 7, 2008
U.K. Property Stocks Dip as Morgan Stanley Sees Slump
Nov. 6 (Bloomberg) -- Land Securities Group Plc and British Land Co., the U.K.'s largest commercial-property companies, declined in London after analysts at Morgan Stanley said the shares may fall to the lowest levels since at least 1995.
A team led by Martin Allen, a London-based analyst at Morgan Stanley, cut its ratings for the stocks because of ``rising concern'' over debt gearing covenants.
U.K. property companies have struggled to raise money from sales of real estate as transactions have dried up because of a shortage of bank finance. That has made it harder for them to cut debt and has contributed to a 30 percent decline in the FTSE 350 Real Estate Index in six months.
A team led by Martin Allen, a London-based analyst at Morgan Stanley, cut its ratings for the stocks because of ``rising concern'' over debt gearing covenants.
U.K. property companies have struggled to raise money from sales of real estate as transactions have dried up because of a shortage of bank finance. That has made it harder for them to cut debt and has contributed to a 30 percent decline in the FTSE 350 Real Estate Index in six months.
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