Where is the Pound really heading to?

One of the biggest questions is everyone’s mind nowadays is where is the pound heading to.

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One of the biggest questions is everyone’s mind nowadays is where is the pound heading to.  Does this mean things will definitely go down this route that I envision? Absolutely not. When it comes to economics, politics and foreign exchange rates (all closely tied) no one really knows what’s coming

What will make or break the pound?

The thing that will make the pound make, or break, is whether a Brexit agreement will be formed in the coming months, before the people, the EU, and the market will reach a definite conclusion that there is no agreement (i.e. a hard Brexit). Will any agreement of an orderly Brexit will bring back confidence to the pound? Probably not, but once an agreement has been reached, it is likely that the downslide of the pound will stop (but not sure going to recover its rates).

What are the chances of an agreement taking place?

The EU’s stances on the Brexit negotiation were very rigid right from the beginning, and it doesn’t seem, or at least not reflected back to the media, that these stances have changed over the course of the year. The EU is well aware of the fact a hard Brexit will be devastating to the British economy, and they will make the best out of the situation (which is ill-favored to them, to begin with, because the EU would have been better off with the UK). The disarray and fear rising in the UK will only refuel the flames, it is now more apparent than ever than that the EU will essentially decide on the state of the economy in the UK for the next 5-10 years at least.

Where should be pound be heading to in each scenario?

  • If a deal is made by October, it passes and regarded as a good deal for the British economy, the Sterling may jump 5-7% back to the 1.20’s (against the Euro).
  • If a deal is made by October, passes but it is seen as the kind of deal that May was forced into complying with and is not favorable enough with the economy, we are seeing the 1.15-1.18 range as fit (pretty much where it’s been at over the past few months).
  • If a deal is made by October, but PM May is unable to pass it, it signals a “no-deal” and pound will shift below 1.10 against the Euro and may reach parity by year’s end.
  • If no deal is made by October, it signals a “no-deal” and pound will shift below 1.10 against the Euro and may reach parity by year’s end.

Out of these scenarios, there is almost no upside to the pound. Only if the best scene takes place we will be experiencing 5-7% increase, but in every other situation, the GBPEUR will either stay where it is now or decline. Hence, if you are considering exchanging your GBP to EUR and waiting for the “rates to improve”, we think it’s unrealistic. Better to pull the trigger now than to expect big hopes from a nation that voted “leave”.

If you are a business in need of finance, then you can consult Richard Butler Creagh at Henley Finance. Connect with Richard Butler Creagh on his Linkedin page here if you want financial support for your business. More advice on bridging loans can be found at Richard Butler Creagh Facebook here

Costing the country: Britain’s finance curse

‘Finance curse’ sucks talent and investment from other industries, costing £67,500 per person over the course of two decades, say, researchers.

‘Finance curse’ sucks talent and investment from other industries, costing £67,500 per person over the course of two decades, say, researchers.

The UK has lost out on a “staggering” £4.5 trillion over the course of two decades because of an oversized financial sector, a new study has found. The “gravitational pull” of the City of London has damaged economic growth by sucking talent and investment from other productive uses such as manufacturing and research while inflating asset prices, particularly property, a paper from The Sheffield Political Economy Research Institute concluded. Between 1995 and 2015 this “finance curse” has lowered cumulative GDP by 14 percent compared to what it would have been with a leaner financial services sector, the researchers found.

Between 1995 and 2015 this “finance curse” has lowered cumulative GDP by 14 percent. They drew on previous academic studies from economists at the International Monetary Fund among others, who observed that as the level of credit to the private sector increases it generally boosts the economy as funds are allocated to people and businesses that need it.

According to the new research, the UK, which has a very large financial sector, has foregone a “staggering” £4.5 trillion of economic growth – equivalent to two and a half years of GDP or £67,500 per person.The researchers concede that the results are approximate and that further work is needed to confirm the size of this effect in the UK and its causes. Meanwhile, financial services firms reaped an estimated £400bn in excess profits.

These booming profits and salaries pushed up the relative value of the UK’s currency, making manufactured goods and agricultural products more expensive to overseas buyers. Because the price of those goods is set internationally some businesses in those sectors have become less competitive or even unviable. There are many different financing options available to real estate investors. If you are a business in need of finance, then you can consult Richard Butler Creagh at Henley Finance. Follow Richard Butler Creagh on Twitter and connect with Richard Butler Creagh on his Linkedin page here.

The Most Painless Approach to Securing a Bridging Loan

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Bridging loans are fast becoming mainstream these days. What used to be considered a niche loan is gaining more popularity in recent years thanks to the fact that more people have come to realise all the many benefits that it can bring about especially if they are involved in property investments.

Bridging loans are considered to be short-term solutions for financing problems. It is possible to take this loan to finance a property purchase especially if the goal is to get proper financial cover for the period prior to a mortgage that is meant to get paid off for the long term.  Some people might get scared at the idea of having to take out a loan that needs to be paid within a period of twelve months only, especially one that is meant to pay for a property purchase. However, this should not scare people off especially since this means is that you are only taking a loan that would normally not be available if you are going to take advantage of it through traditional lending channels.

Consumers are especially interested in this type of loan due to how it allows them to secure a new house even before they can complete the sale of their old property. It is also quite common to use this type of loan today in order to win a bidding war. There are property owners that take advantage of property auctions as it allows them to secure a property fast and often, at a very competitive rate too. However, properties bought from an auction need to get the entire purchase completed within a short period of time. Since it is usually impossible for buyers to have pockets enough to pay for the costs, they take advantage of a loan.

Still, getting financing through traditional means would require a long time. Property auctions require the amount to be paid within 28 days only. This is where people turn to bridging finance to get the funds that they need. Bridging loans are a lot faster to process and the requirements tend to be less challenging when compared to what traditional lenders require.

When applying be aware that the industry has essentially skyrocketed over the years, thanks to the increase in the instances of auction house buys. This means that due diligence is needed in order for you to find the right lender. Not every single one of them is going to be the same so it is up to you to find one that is credible, reliable, and trustworthy at the same time.

The best and fastest way for a bridging loan to get approved is to make sure that you have some sort of security to use as a leverage for the loan. Your credit history can also factor in on whether your loan is going to be approved fast or not. A good credit history would mean faster approval. So, keeping a good financial record can truly benefit you in the process. Do compare your choices before you make a choice.

Watch the video below to learn more.

Learn more about how you can get your bridging loan application approved faster by reading about Richard Butler Creagh online. You can also checkout Richard Butler Creagh Visual CV here.

How to Buy a House at Property Auctions

Tips on bagging a Property at an Auction

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While it is true that purchasing a property at an auction does come with some inherent risks, when done right, it is also a great way to secure a good bargain. If you are prepared to take on the risks involved, you will find that buying at a property auction can offer you some very incredible savings.

For those that are doing this for the first time, the prospect may be a bit intimidating to you. To help guide you on your first attempt at buying a property at an auction, below are some tips for you.

Find an auction

You need to locate auction houses that offer properties where you are interested in buying a property from. Many of the London auctions tend to offer properties that are located in London as well as in the Home Counties. For auction houses outside of London though, expect that they are likely to focus on local properties.

After finding an auction house, secure an auction catalogue by being part of their mailing list. These catalogues will be available a few weeks before an auction so this should give you enough time to find out about the pricing as well as the sale conditions.

Check the fine print

This is something that you should never skip on when joining an auction. Read through the document and make sure to send a copy to your solicitor. Be aware too that flats and houses that are sold in auctions tend to require some renovation and modernisation. Being aware of the extent of the repairs needed is helpful and a survey is often a good way to do so.

Ensure fair value

Find out more details on the local property market before you will sign up for the auction. This will help you get an idea of the actual worth of the property. This will also help you set a maximum bid. Be aware that it is a common mistake that people make during auctions to get carried away and bid more than maximum. So, always make sure to set a specified limit and stick to it.

 Bring the right stuff

Find out what kind of ID you will be asked to show. Know about the methods of payment that are being accepted as well. For a successful bidder, an exchange of contract is to be expected a deposit fee amounting to 10% of the property’s purchase price is expected to be made too, along with the auction house fee. Purchasing from an auction often requires four weeks to complete. Be aware that if you do not get it completed by the set date, the seller could sue you and you will likely lose the deposit too.

Watch Richard Butler Creagh video below.

Auctions need not be that intimidating when you know what to do. Before taking part in one, learn more about how you can get the best property deals at auctions by checking out Richard Butler Creagh website here. You can also connect with Richard Butler Creagh on Linkedin here.

 

Golden Rules to Keep in Mind when Buying Property at Auctions

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It is becoming an increasingly popular practice for estate agents these days to partner with an auction house when selling properties. A large volume of properties is now being auctioned off with the goal of getting more members of the public to get access to them, instead of just offering them to private investors only.

If you are considering the possibility of buying a property through this method, there are things that you will need to learn first. Doing this for the very first time can be a little challenging. But when you know what are the things that you can expect from an auction process and what are the things that you should not do when you attend one, you can effectively avoid making expensive mistakes and other common pitfalls.

Research first before the biding day

You will want to know exactly how the bidding process works before you will start making one. Refer to the auction catalog to get a good idea of the flow of the process. You will feel more at ease during the actual auction when you already know what to expect. Also, make sure to visit the property that you are interested in to assess ahead of time if it is really going to be worth buying or not. It helps to take someone along when you do the visit to get another opinion and a different perspective on the property.

Learn some auction house jargon

It is easy to get overwhelmed with the bidding process when you do not understand auction speak. There is jargon specific to auction houses that you will want to familiarise yourself with to understand better what is going on. From reserve price to guide price to sale price, make sure you know exactly what each of these terms means.

Get your finances arranged ahead of time

You will be expected to pay 10% of the purchase price along with fees the moment that your bid has been finalized. In addition, you will be given a 14 to 28 day period of completion. It helps if you will be able to secure an approval in principle when it comes to financing your purchase before you will push through with the bidding.

Fees can easily add up

You will realize that the fees involved in a bidding process can easily add up. You will be charged an auctioneer or a buyer’s fee. There will be legal fees, as well as new finance fees, lender exit fees, survey fees, broker fees, and many others. It is important to do due diligence beforehand so you know exactly what you are getting into.

Dry runs are a lifesaver

It helps to know ahead of time how things are going to happen. Visit other auctions in other auction houses to observe how the bidding process unfolds. Observe at least two auctions to get a better feel for how things work.

If you want to learn more about buying properties at an auction, visit Richard Butler Creagh website. For more advice on bridging finance and property auctions, check out Richard Butler Creagh Facebook and follow Richard Butler Creagh on Twitter.

 

Extra Costs of Buying Investments

Richard Butler-Creagh founded Henley Finance which provides short-term bridging finance to property development sector. Find out more about the extra cost of buying investments below:

There are a lot of worries today on how expensive properties are. The truth is it is even more expensive than most buyers and investors think because of the number of costs associated when buying an investment property that many of us fail to take into consideration. Let’s take a look at the most common costs related with buying your next investment property.

Stamp duty

Stamp duty is one of the most expensive costs associated when buying an investment property. The cost of stamp duty differs depending on the state and value of your property. It can easily add 5% to the cost of your property. This is money you have to prepare since the banks won’t lend you this.

Legal fees

It is imperative to have a solicitor on your side to help you when you want to buy a property. Solicitors can charge anywhere from £600 to £1000 for your property purchase. A solicitor will help you with the signing of contracts, making sure the settlement processes will run smoothly, ensure all activities and processes are conducted legally and save you from anything that could affect you in the future by doing all the necessary due diligence.

Building and pest inspection

When you are planning to buy a stand-alone property rather than an apartment, it is crucial to organize a building and pest inspection. Older properties usually have a number of hidden issues that you may not have noticed on your initial inspection. So, don’t be too surprised if they turn up on the report. The expenses of a building and pest inspection may differ, but these are a good form of insurance. Remember if buying at an auction, this needs to be done well before the auction day because auction sales are unconditional.

Accountant

A suitable accountant will pay for themselves many times over by understanding the investor’s personal situations and help them arrange your investments properly and as well as making sure you will take the advantage of the myriad of legal tax loopholes available to investors.

Property manager

It is vital to engage with an expert property manager to look after your assets. While property management costs differ from agency to agency, this is not an area to try and cut back on costs. There is a huge difference between professional property managers and your rents being collected by the local estate agency.

Visit Richard Butler-Creagh website here, Connect with Richard Butler-Creagh through Linkedin here and watch Richard Butler-Creagh video here.

 

 

Top Facts about London’s Property Market

gI_66742_hf logoAt Henley Finance we bring you the latest news from the world of bridging finance and specialist property lending. Leading property agent “Portico” has recently launched out a fun quiz to find out what Londoners actually know about the capital’s property market.
“How many days, on average, does it take for a London property to go under offer?” is the question from the quiz that has the most incorrect answers. 67% of the quiz takers has thought the average time it takes for a property in London to go under offer was 32 days or fewer. But based on actual fact, because of subdued market conditions, the correct answer was almost double to what the people know, it is 60 days and only 27% of the quiz takers answered correctly. Despite of the fact that the Bank of England has recently voted to keep interest rates unchanged, there were a lot of uncertainties surrounding the rate. Only 25% of the respondents were not able to correctly recall the UK’s present base rate of .25%
The respondents were also asked “How many active London rentals are currently on Airbnb?”. An enormous amount of 66% of quiz takers were not aware of the number of Londoners using the short-term let site, instead choosing for much lower figures.
The findings were indeed surprising. The quiz showed that Londoners know their house prices, it has 80% able to identify which property among the four choices was currently on the market for £300,000 or less. Londoners are also clearly clued up on buying properties. 52% were able to answer how much “Stamp Duty” would be due on a £500,000 additional property and only 77% was aware of the minimum deposit needed for a London Help to Buy equity loans.
London is one of the best cities in the world to work, whether it is in the financial institutions or a trendy design company. London office space has some of the most expensive in the world at 250 dollars per square foot. This is twice as expensive as the 5th most expensive place which is Shanghai at 136 dollars per square foot.
Specialist lenders have witnessed the total value of their lending increase to £17bn per year in 2016 – more than a three-fold increase from the low base of £5bn recorded in 2009.
Specialist lenders are now in a position of strength following the market’s turbulent past and are effectively catering for the growing number of ‘non-standard’ borrowers in the UK who fall outside mainstream lenders’ criteria.
If you are interested on London’s property market, visit the official page of Henley Finance and Richard Butler Creagh here. Know more about Richard Butler Creagh and read more industry updates on his Twitter page. Watch this video to find out more: