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The Independent
a day ago
- Business
- The Independent
How much would you pay to live here? Now add another 20 per cent…
Just a month after a surprising fall in house prices, they have bounced back and then some – taking both the City and your correspondent by surprise. New figures from Nationwide show that prices increased by 0.5 per cent in May when compared to April. Prices in that month had fallen 0.6 per cent compared to March. The annual rate, when compared to May 2024, also edged higher (3.6 per cent) when compared to April's annualised 3.5 per cent rise. April's slowdown was always expected, coming as it did after a flurry of activity in March as purchasers rushed to get purchases through ahead of Rachel Reeves' stamp duty increases. But the rapidity of the bounce back comes as a surprise. True, this could be a blip, and Nationwide's is just one of a number of indices. And we're not in a boom, nor anything like it. However, despite how stretched affordability has become, parts of the market are looking very frothy. Pity the would-be buyer. In many parts of the country, becoming an owner occupier is a distant dream unless you have access to the favourable rates available from the Bank of Mum & Dad LLC, one of the nation's biggest, and most selective, lenders. London and the South East have long been positively ruinous for a long time, with prices there in the 'completely crazy' category. There isn't much room for growth, even with lenders offering longer term loans and fancy multiples of prospective borrowers' salaries to encourage first-time buyers. But that is by no means true in other parts of the country, where temperature gauge is firmly in the red. The most recent regional data, available from the Office For National Statistics, dates back to March. It shows that the Shetland Islands – one of the UK's remotest regions – recorded annualised growth of 18 per cent, followed by North East Derbyshire at 17 per cent and Blackburn & Darwen, also at 17 per cent. The first two of those are, obviously, highly rural, and rural areas have proven to be quite spicy in recent years. The trend of people moving from urban was established during the pandemic and found mixed results. Regretters were not uncommon. The bucolic fantasies promoted by shows like Escape to the Country are far from reality. City-dwellers typically have to confront unexpected challenges, such as services they take for granted not being there. However, the overall trend isn't reversing. Nationwide found growth of 23 per cent in rural areas between December 2019 and December 2024, compared with just 18 per cent in areas that are largely urban. There are, nonetheless, plenty of urban hotspots to be found in the ONS data, including Newcastle upon Tyne (14 per cent), Liverpool (14 per cent), Middlesbrough (14 per cent) and Hartlepool (13 per cent). This underlines an unpleasant fact for would-be buyers: it's tough going wherever you happen to be looking. What's the house-hunter to do? I'd gently suggest listening to Nick Mendes, from broker John Charcol who says: 'For consumers, this is a market that rewards preparation. Mortgage rates are still competitive, but deals are moving fast and lenders are selective.' He adds: 'Getting a solid deposit together, tightening up credit and working with a broker who knows the full market makes a real difference.' So delete the Klarna app, burn your credit cards, and save until it hurts. Of course, Mendes works for a broker so he would naturally advocate for their services. However, for many, sitting down with a professional is a sound idea. They often have access to deals that aren't available direct and they can be particularly helpful to people who don't fit into the comfortable boxes that big lenders, and big insurers, prefer. Those people aren't uncommon. Mendes is particularly on the money when he says this: 'Some lenders have relaxed affordability rules, particularly on longer-term fixes, and that might increase how much you're told you can borrow. But just because you can stretch your budget doesn't mean you should.' But is that message getting through? As tough as it is for buyers, it remains a much better option than renting for those who have the resources. Prices in the private rented sector are no less inflated. They're often worse. This helps to explain he willingness of buyers to stretch themselves. It isn't wise. But when the alternatives are so miserable, it is understandable. Most forecasters think prices will tread water over the next few months, despite the latest uptick. The economic uncertainty stalking to the world, thanks in no small part to Donald Trump's trade war, should help to keep a lid on things. But with wage settlements outpacing inflation, they are expected to start to accelerate later in the year, even with the cold water recently poured over hopes for more interest rate cuts by unexpectedly high inflation. Now is the time to take the plunge. If you can.
Yahoo
2 days ago
- Business
- Yahoo
Aussie couple dodge $40,000 fee with $150,000 mortgage move: 'Going to see a lot more'
More Australians are turning to the Bank of Mum and Dad to get a foot on the property ladder as prices continue to skyrocket. But instead of giving cash, some parents are putting up part of their home equity to help their kids get into the market quicker and avoid mortgage insurance fees. Chelsea Anderson and her partner Jaimyn Wiki purchased a four-bedroom townhouse in Brisbane in March using a guarantor home loan. The 27-year-old real estate agent told Yahoo Finance the parental help meant the couple could buy the $925,000 property with a 5 per cent deposit. 'We went down the guarantor route so we wouldn't have to pay LMI [Lenders Mortgage Insurance]. We saved ourselves about $40,000 in cash,' Anderson said. RELATED Bank of Mum and Dad warning over common mortgage issue: 'Seek legal advice immediately' Coles, Woolworths shelves reveal devastating reality for coffee lovers: 'From $49 to $62' Aussie couple making $1,200 a day from job anyone can do: 'Went off like an explosion' Wiki's parents are guaranteeing about $150,000 of the property purchase by putting up their own home as equity. This has given the couple 20 per cent security needed to buy the home without paying LMI. The couple bought the home as an investment property and hope to remove the parents as guarantors from the loan within the next two years. They bought their first property, a two-bedroom unit for $535,000, in August last year and used the first home guarantee to buy with a 5 per cent deposit. 'I would say it's probably gone up about $100,000 in value since then,' Anderson said. Anderson said the couple were keen to expand their portfolio, and Wiki's parents had previously offered to help them. 'We could feel the market is going to increase and keep growing in Brisbane and we had a deposit to be able to buy another property, so we wanted to leverage on the growth before the rates start dropping more and prices keep going up," she said. Mortgage brokers have reported seeing a rise in guarantor loans among first-home buyers, with Loan Market data finding they now make up 66 per cent of loans written in their network. That's up from 50 per cent for the same month last year and 38 per cent four years ago during the pandemic. Loan Market broker Caleb Bax said he expects guarantor loans would continue to increase in popularity. That's partly because more parents will now be in a position to help, as their own home values skyrocket. 'There are a lot more people who are in a position to help,' he told Yahoo Finance. 'Obviously, current house prices seem to keep going up, so it's just making it harder and harder for first-home buyers. 'We are going to see a lot more people relying on parental help and it's a way for a parent to help without having to physically out lay cash, they can temporarily lend or borrow against their home.' Along with helping buyers purchase a home with a small, or no, deposit, Bax said buyers may be able to get a more appealing interest rate on their mortgage as they will be seen as a 'less risky' client. Bax warned there were major risks to be aware of, with the guarantor on the line if their loved one can't meet their repayments. 'If the applicants were in a position where they couldn't make home loan repayments and the property price hadn't increased, the bank has the right and ability to come after the guarantors up to the limit of the loan that they've taken the guarantee for,' Bax said. 'So, say someone had a $150,000 guarantee against their home. The bank can come for that, even if they've paid that down a bit and maybe have $130,000 leftover. 'The bank can go up to the guaranteed limit, so $150,000, to recoup any of the lost money, including legal fees. 'So then the guarantor either has to take on the loan themselves against their home and pay those repayments, or they could be in a position where they have to sell their home.' Along with the financial risks, the arrangement also has the potential to put a strain on the relationship between parents and their kids. If you go down the guarantor route, Bax said it was important to have an exit strategy in place to get the guarantor off the loan as quickly as possible. Bax said this could include purchasing below your means so you can pay off the loan quicker, renovating the property to add value to it, or potentially putting down any lump sum bonuses into the home. 'With the property market the way it is, it's appreciated so quickly that we are seeing they are able to get off quite quickly,' he added. Anderson said she and her partner had a plan in place before they approached the parents and asked them to go guarantor. 'The average growth for that area for the last year was about 12 per cent, so we figured that we'd get them off on growth alone in probably a year and a half,' she said. 'We also thought the unit we bought initially was not a long-term unit, it's our first home. So we thought eventually when we sell that, whatever profit we have from that will go into the other property, and that would remove them, whichever came first.' Bax encouraged Aussie homebuyers to speak to a mortgage broker to understand how having a guarantor could impact them and whether other avenues like LMI waivers or government guarantees are worth exploring first. "It's always worth the guarantors getting independent legal advice as well," he said. "So, seeing a solicitor to understand the risks associated in more detail, so that they are informed enough to make the decision whether to help their kids."Error while retrieving data Sign in to access your portfolio Error while retrieving data
Irish Independent
2 days ago
- Entertainment
- Irish Independent
Applying to the Bank of Mum and Dad about getting your inheritance early – the dos and the don'ts
The first rule of the Bank of Mum and Dad is you do not talk about the Bank of Mum and Dad – to paraphrase Fight Club – the cult 1990s novel and film that riffed on generational angst.
Yahoo
4 days ago
- Business
- Yahoo
Driver's $200 fuel cost exposes Aussie car hire company: 'Said it was our fault'
Welcome to legal column where lawyers Alison and Jillian Barrett from Maurice Blackburn tackle problems everyday Aussies face — whether it be consumer, property, money matters impacting relationships or work. This week, a holidaymaker feels ripped off by a car hire service. Question I booked a hire car through a third-party website for a recent trip and specifically booked a hybrid as we'd be covering a lot of kilometres. The booking said it would be a Toyota Corolla hybrid "or similar". The car hire place was a bit chaotic and they just handed us the keys and told us to find it in the car park. It wasn't until we had driven away that I realised it wasn't a hybrid. We spent over $200 on fuel and when I took the car back the manager was really rude and said there was nothing they could do and it was our fault for not noticing sooner. Is there anything I can do to claim some money back? Answer Booking a hire car can sometimes lead to unexpected issues and frustration, especially when the vehicle provided does not match the description promised at the time of booking. When you hire a car, you enter into a contract with the car hire company. This contract is based on the terms and conditions outlined on the website at the time of Bank of Mum and Dad warning over common mortgage issue: 'Seek legal advice immediately' Australia's most in-demand jobs revealed with $125,000 salaries up for grabs $1,831 Centrelink payment change coming within weeks Further, under the Australian Consumer Law, consumers are entitled to certain guarantees when they purchase goods and services. These guarantees include that the goods will match the description provided at the time of booking. If the booking confirmation stated that you would receive a Toyota Corolla hybrid "or similar', the car hire company is obligated to provide a car that meets this description. If they fail to do so, they may be in breach of contract or the Australian Consumer Law. Review the booking confirmation: Carefully check your booking confirmation and any terms and conditions (likely emailed to you) provided by the third-party website. You should specifically look for any clauses related to vehicle type and substitutions. Gather evidence: Collect all relevant documentation, including the booking confirmation, receipts for fuel expenses, notes of conversations and any correspondence with the car hire company. This evidence will be crucial if you need to pursue a legal remedy. Contact the car hire company: Write a formal complaint to the car hire company using their internal dispute resolution service, outlining the issue and requesting reimbursement for the additional fuel costs. Be sure to reference the contract and include all evidence. Escalate the complaint: If you can't resolve it with the car hire company, escalate the complaint to the third-party website through which you made the booking. They may have a dispute resolution process you can use. If your dispute remains unresolved there are more formal avenues you can pursue. The Australian Car Rental Conciliation Service provides a free mechanism for resolving disputes between disgruntled customers and certain car rental companies that have agreed to abide by the Car Rental Code. Additionally, you can report the issue to the Australian Competition and Consumer Commission, which oversees consumer protection. They may investigate the complaint, however won't assist in resolving the dispute or requiring a refund or compensation be paid to you. Finally, each state and territory has their own Civil and Administrative Tribunal which will allow you to lodge a claim against the car rental company to claim your money back. There is often a small fee to lodge a claim, so you'll need to consider the cost of that compared to your actual loss to ensure it is financially worthwhile lodging a claim. This legal information is general in nature and should not be regarded as specific legal advice. If you need legal advice, you should consult a solicitor.
Yahoo
7 days ago
- Business
- Yahoo
Bank of Mum and Dad warning over common mortgage issue: 'Seek legal advice immediately'
Welcome to legal column where lawyers Alison and Jillian Barrett from Maurice Blackburn tackle problems everyday Aussies face — whether it be consumer, property, money matters impacting relationships or work. This week, a father's concerned about a financial leg up he gave his son to get on the property ladder. Question My son built a house on land we gave him funds to buy. When it was completed, he and his girlfriend moved in. They have lived in the house together now for several years. If their relationship broke down would she be entitled to any settlement from the property? She contributes with the usual living expenses while he pays his mortgage. Could our gift contribution be included in a settlement payout if there was one? Answer Navigating property settlements following the breakdown of a relationship can be a complex and emotionally charged process. Hopefully, your son never needs to tackle this. RELATED Generational shift in Bank of Mum and Dad leaves Aussie parents $74,040 out-of-pocket: 'Very concerned' Little-known Centrelink benefit gets Aussie single mum $800 cash boost: 'Done in 10 minutes' $3 million superannuation tax change sparks property warning as 'panic' selling begins In Australia, de facto couples have similar rights and obligations as married couples when it comes to property settlement. According to the Family Law Act 1975, a de facto relationship is defined as a relationship between two people who are not married to each other but live together on a genuine domestic basis. Given that your son and his girlfriend have lived together for over four years, their relationship would likely be considered de facto under Australian law. If their relationship breaks down, either party can apply for a property settlement. The court will consider various factors to determine the division of property, including the duration of the relationship, the financial and non-financial contributions made by each party, the future needs of each party, and the care and support of any children from the relationship. A precise formula isn't applied (or a 50/50 split), it depends on the circumstances of the case. In your son's case, his girlfriend's contributions to the usual living expenses and the fact that they have lived together for over four years would be taken into account. If her financial contributions were intended to be rent and there is documentation to support this, then it could influence the property settlement. However, in most de facto relationships, contributions towards living expenses are viewed as part of the couple's shared financial responsibilities rather than a formal rental non-financial contributions she has made to the property would also be considered. For example, perhaps she assisted with painting the home or performed homemaking duties. Your son's contributions would also be considered, including the mortgage repayments and initial purchase costs. The court would assess both parties' contributions and may determine that his girlfriend is entitled to a portion of the property. If the value of the property has increased since it was built, that too is likely relevant when assessing her entitlement. Your financial contribution to the purchase of the land and the construction of the house could be considered in a property settlement. The court would look at the source of the funds and the intention behind the gift. If it was intended as a gift to your son alone, this could be argued. If you have clear documentation of the gift and any agreements made at the time of the contribution it may influence the court's decision in a property settlement. Without this, it may be difficult. The best option in this situation is for your son to immediately seek legal advice and explore a binding financial agreement. Properly drafted, this is a legally enforceable agreement between your son and his girlfriend that can be made at any time during a relationship. It outlines in significant detail how property and assets will be divided in the event of a relationship breakdown and also deals with things like spousal maintenance. The financial contribution you made to the property can also be provisioned for in the agreement. This legal information is general in nature and should not be regarded as specific legal advice. If you need legal advice, you should consult a while retrieving data Sign in to access your portfolio Error while retrieving data
