Property website Rightmove, which says it captures 90 percent of all homes for sale, said asking prices jumped 3.1 percent this month, following drops of 1.1 percent in September and 1.7 percent in August.
The annual rate of growth in prices rose 2.9 percent from 2.6 percent in September.
Rightmove's findings counter the plunge in September house prices reported by mortgage lender Halifax, and appear "illogical" given the oversupply of homes on the market and buyers' difficulty in getting mortgages, the survey said.
Though market conditions should be a drag on the market, higher prices follow the autumn trend, with October prices rising every year since the inception of Rightmove's House Price Index in 2001, the survey said.
"Vendors coming to market after the summer holidays hope to take advantage of any positive price impetus from buyers who are keen to be in a new home before Christmas," said Miles Shipside, director of Rightmove.
"Between 2007 and 2009, October sellers tried higher prices in spite of the 'credit crunched' housing market, and it's a habit that is proving hard to kick in the 'spending review' market of October 2010."
The comprehensive spending review, which Wednesday will outline details of how Britain plans to slash its record budget deficit, is likely to dampen confidence in the housing market, Rightmove said.
Some sellers may not be able to afford lower prices, while estate agents may encourage a speculative opening price that can be lowered later, it said, adding that with sellers staying put on prices, and buyers unable to pay more, the housing market was in danger of stagnating.
"Buyers and sellers are staring each other out, and it's a question of who will blink first," Shipside said. "Even if they wanted to, buyers cannot blink unless lenders release more funds for mortgages.
"As that's not going to happen, there are likely to be some blinking sellers this winter."
Rightmove based its data on a survey of 105,769 asking prices on its website between September 12 and October 9.
Monday, October 18, 2010
Tuesday, June 22, 2010
The ending of the renminbi peg with the US dollar; China tries to stall rise in currency
The ending of the renminbi peg with the US dollar; China tries to stall rise in currency
Following Saturday's surprise announcement by the People's Bank of China (PBoC) of an ending of the renminbi peg with the US dollar that had been in effect since July 2008, and the return the managed float system, which resulted in a rise in the value of the Chinese currency by 17.5% since mid-2005, China on Tuesday left the renminbi drop slightly in value against the dollar in a move that was seen as deterring speculators benefiting from a stronger currency.
The PBoC had initially set the reference point for the day's trading 0.43% above Monday's level, to the highest level in five years, which appeared to be a signal it was comfortable to see a slight appreciation in the currency. However, while the renminbi initially rose against the dollar, by the end of trading Tuesday it had fallen 0.23% to CNY6.8136 compared with the peg rate of 6.828. Traders are reported to have said state-owned banks had been in the market buying dollars, which they saw as a sign the authorities were trying to control tightly the value of the renminbi and limit expectations of future gains. On Monday the currency rose 0.42% against the dollar.
In the markets, the optimism that greeted China's decision, in advance of the G-20 summit in Toronto this weekend, was replaced Tuesday with continuing concerns about the Eurozone banking sector and the US housing market.
Morgan Stanley economist, Qing Wang, based in Hong Kong, summarised the impact of China's move.
1) A renminbi exit from the USD peg would lower the risk premium of the equity market stemming from fear of a Sino-US trade war.
2) It helps contain ‘imported' inflation pressures and therefore reduces the probability of an aggressive monetary tightening in China through stringent credit controls and/or consecutive interest rate hikes.
3) A modest initial revaluation to be followed by gradual appreciation would fuel expectations of further appreciation over time.
Impact on our economic and policy calls:
MS said it maintains its forecasts for the USD/CNY spot rate to reach 6.60 by end-2010 and 6.20 by end-2011.
It changed its interest call from "no more than one rate hike in 2H10" to "no rate hikes through 2010".
It attaches a high probability that the target of new bank lending of Rmb7.5trn for 2010 could be revised upward by 4Q10.
In view of this desirable policy change, MS maintains its call for a Goldilocks scenario (not too hot or too cold) in 2010, featuring 11% GDP growth and 3.2% average CPI inflation, while noting that the balance of risks on both fronts is tilted slightly to the downside.
Following Saturday's surprise announcement by the People's Bank of China (PBoC) of an ending of the renminbi peg with the US dollar that had been in effect since July 2008, and the return the managed float system, which resulted in a rise in the value of the Chinese currency by 17.5% since mid-2005, China on Tuesday left the renminbi drop slightly in value against the dollar in a move that was seen as deterring speculators benefiting from a stronger currency.
The PBoC had initially set the reference point for the day's trading 0.43% above Monday's level, to the highest level in five years, which appeared to be a signal it was comfortable to see a slight appreciation in the currency. However, while the renminbi initially rose against the dollar, by the end of trading Tuesday it had fallen 0.23% to CNY6.8136 compared with the peg rate of 6.828. Traders are reported to have said state-owned banks had been in the market buying dollars, which they saw as a sign the authorities were trying to control tightly the value of the renminbi and limit expectations of future gains. On Monday the currency rose 0.42% against the dollar.
In the markets, the optimism that greeted China's decision, in advance of the G-20 summit in Toronto this weekend, was replaced Tuesday with continuing concerns about the Eurozone banking sector and the US housing market.
Morgan Stanley economist, Qing Wang, based in Hong Kong, summarised the impact of China's move.
1) A renminbi exit from the USD peg would lower the risk premium of the equity market stemming from fear of a Sino-US trade war.
2) It helps contain ‘imported' inflation pressures and therefore reduces the probability of an aggressive monetary tightening in China through stringent credit controls and/or consecutive interest rate hikes.
3) A modest initial revaluation to be followed by gradual appreciation would fuel expectations of further appreciation over time.
Impact on our economic and policy calls:
MS said it maintains its forecasts for the USD/CNY spot rate to reach 6.60 by end-2010 and 6.20 by end-2011.
It changed its interest call from "no more than one rate hike in 2H10" to "no rate hikes through 2010".
It attaches a high probability that the target of new bank lending of Rmb7.5trn for 2010 could be revised upward by 4Q10.
In view of this desirable policy change, MS maintains its call for a Goldilocks scenario (not too hot or too cold) in 2010, featuring 11% GDP growth and 3.2% average CPI inflation, while noting that the balance of risks on both fronts is tilted slightly to the downside.
Monday, June 7, 2010
Three great ways to save for your kids
Now that Child Trust Funds are a thing of the past, many people will be looking for new ways to save for their children and grandchildren.
The good news is there are several options open to you. Here, I’m going to highlight some of the best savings options for those wanting to build a nest egg for the next generation.
The current economic climate means it’s almost impossible to predict what savings rates will do in the next couple of years. If you choose an account that locks your money away for the long-term, it’s quite possible savings rates will rise and your rate will be left far behind.
Because of this, I’ve focused on accounts that lock your cash away for a year or less.
Cash ISAs
Children can't open their own cash ISA until they reach 16. But if you haven't already used up your ISA allowance, you could open one to start saving for their future now. The main plus point about ISAs is, of course, their tax-free status. Current cash ISA rates may not seem that impressive; but when you compare them to (taxed) savings accounts paying higher rates, you'll find they’re pretty hard to beat. This article explains why cash ISAs offer such good value for money.
If you already have a Nationwide current account, the building society’s e-ISA might be a good choice. It offers a decent variable rate of 2.75% AER (including a 1% bonus until 30th June 2011) and you can open it with just £1.
The Nationwide e-ISA also allows transfers in from previous years’ ISAs; and it won’t penalise you for transferring money out.
Related goal
Save for your child's future
The sooner you start saving for your child's future the better. Starting early will give you the best chance of giving them a great financial head start in life.
Do this goalIf you’re not a Nationwide current account holder and you still want transfer flexibility, another good option is the ISA Extra from Birmingham Midshires. This account offers a variable rate of 2.7% AER (including a 1% bonus for 15 months), allows transfers in from previous years’ ISAs, and won’t penalise you for transferring money out.
Just be aware that you’ll need at least £500 to open the account.
If you’re not looking to transfer ISA money in - and you’re willing to leave the cash alone for a full year - you’ll get a higher, fixed rate elsewhere. The 1 Year Fixed Rate ISA (3) from Coventry Building Society pays 3.25% AER until 30th May 2011.
However, you’ll be sacrificing flexibility to get this rate. You can make just one deposit (which has to be the full £5,100 allowance); you can’t transfer money in from previous ISAs; and you’ll lose 120 days’ interest if you make any withdrawals during the year.
Fixed rate bonds
If you’ve already used up your ISA allowance - and you still have a lump sum to stash away - a fixed rate bond may be the account for you. At the moment, accounts from two little-known banks top the one year bond category.
The first is the Fixed Deposit account from United National bank. This pays a very healthy fixed rate of 3.25% AER for the year-long term. On the downside, you’ll need a fairly substantial sum to get you started: The minimum deposit is £2,500.
My second choice is the Fixed Deposit Account from Punjab National Bank (International). This account also pays 3.25% AER for the year, and can be started with just £1.
These banks may not be household names, but both accounts are protected by the Financial Services Compensation Scheme.
In today's video, I'm going to highlight five things you should consider when choosing a savings account.
Regular savings
Many people won’t have a lump sum to stash away, but will be saving for their kids from scratch. If you want to start small, a regular account could be an excellent choice for you.
Regular savings accounts usually last for a year, and require you to save a certain amount (within certain parameters) every month. In return for this commitment, you’ll receive a very good rate of interest.
Just bear in mind that most regular savings accounts don’t offer much flexibility. If you think you may need to get your hands on the cash at short notice, you may want to go for an instant access savings account instead.
One of the highest-paying regular savings accounts currently on the market is the Norwich & Peterborough Building Society Family Regular Saver. It offers a rate of 5% AER (fixed for a year) and allows you to save £1 to £250 per month.
It’s exclusive to families with dependent children up to 16 years of age (or 18 if they are in full-time education). And be aware that 3% of that juicy rate comes in the form of a bonus, which you’ll only get if you save every month for 12 months, and make no more than one withdrawal a year.
Recent question on this topic
toyraman asks:
As govt stopping ctf, what happens to my existing child trust fund account?
SoftwareBear answered "your child can use it when they are 18 to pay off some of the national debt ... or some lollipops..."
MikeGG1 answered "We have still to get the details but they have also said that they will be saving on the cost of..."
Read more answers There’s also a good account aimed specifically at saving for children: The Children’s Regular Saver from Halifax pays a whopping 6% AER (fixed for a year) and any adult can open one of these accounts on behalf of any child.
On the downside, the amount you can save is relatively small - £10 to £100 per month - and this isn’t a flexible account: Any missed payments or withdrawals will result in the money being moved to a Save4It account, which pays a variable rate of just 1.05% AER.
However, several adults can each open one of these accounts for the same child; so if a few of you get together, the savings can really build up.
And this account offers a positive tax angle, too. An account opened in a child’s name is tax-free, providing the child doesn’t earn enough to pay tax!
The good news is there are several options open to you. Here, I’m going to highlight some of the best savings options for those wanting to build a nest egg for the next generation.
The current economic climate means it’s almost impossible to predict what savings rates will do in the next couple of years. If you choose an account that locks your money away for the long-term, it’s quite possible savings rates will rise and your rate will be left far behind.
Because of this, I’ve focused on accounts that lock your cash away for a year or less.
Cash ISAs
Children can't open their own cash ISA until they reach 16. But if you haven't already used up your ISA allowance, you could open one to start saving for their future now. The main plus point about ISAs is, of course, their tax-free status. Current cash ISA rates may not seem that impressive; but when you compare them to (taxed) savings accounts paying higher rates, you'll find they’re pretty hard to beat. This article explains why cash ISAs offer such good value for money.
If you already have a Nationwide current account, the building society’s e-ISA might be a good choice. It offers a decent variable rate of 2.75% AER (including a 1% bonus until 30th June 2011) and you can open it with just £1.
The Nationwide e-ISA also allows transfers in from previous years’ ISAs; and it won’t penalise you for transferring money out.
Related goal
Save for your child's future
The sooner you start saving for your child's future the better. Starting early will give you the best chance of giving them a great financial head start in life.
Do this goalIf you’re not a Nationwide current account holder and you still want transfer flexibility, another good option is the ISA Extra from Birmingham Midshires. This account offers a variable rate of 2.7% AER (including a 1% bonus for 15 months), allows transfers in from previous years’ ISAs, and won’t penalise you for transferring money out.
Just be aware that you’ll need at least £500 to open the account.
If you’re not looking to transfer ISA money in - and you’re willing to leave the cash alone for a full year - you’ll get a higher, fixed rate elsewhere. The 1 Year Fixed Rate ISA (3) from Coventry Building Society pays 3.25% AER until 30th May 2011.
However, you’ll be sacrificing flexibility to get this rate. You can make just one deposit (which has to be the full £5,100 allowance); you can’t transfer money in from previous ISAs; and you’ll lose 120 days’ interest if you make any withdrawals during the year.
Fixed rate bonds
If you’ve already used up your ISA allowance - and you still have a lump sum to stash away - a fixed rate bond may be the account for you. At the moment, accounts from two little-known banks top the one year bond category.
The first is the Fixed Deposit account from United National bank. This pays a very healthy fixed rate of 3.25% AER for the year-long term. On the downside, you’ll need a fairly substantial sum to get you started: The minimum deposit is £2,500.
My second choice is the Fixed Deposit Account from Punjab National Bank (International). This account also pays 3.25% AER for the year, and can be started with just £1.
These banks may not be household names, but both accounts are protected by the Financial Services Compensation Scheme.
In today's video, I'm going to highlight five things you should consider when choosing a savings account.
Regular savings
Many people won’t have a lump sum to stash away, but will be saving for their kids from scratch. If you want to start small, a regular account could be an excellent choice for you.
Regular savings accounts usually last for a year, and require you to save a certain amount (within certain parameters) every month. In return for this commitment, you’ll receive a very good rate of interest.
Just bear in mind that most regular savings accounts don’t offer much flexibility. If you think you may need to get your hands on the cash at short notice, you may want to go for an instant access savings account instead.
One of the highest-paying regular savings accounts currently on the market is the Norwich & Peterborough Building Society Family Regular Saver. It offers a rate of 5% AER (fixed for a year) and allows you to save £1 to £250 per month.
It’s exclusive to families with dependent children up to 16 years of age (or 18 if they are in full-time education). And be aware that 3% of that juicy rate comes in the form of a bonus, which you’ll only get if you save every month for 12 months, and make no more than one withdrawal a year.
Recent question on this topic
toyraman asks:
As govt stopping ctf, what happens to my existing child trust fund account?
SoftwareBear answered "your child can use it when they are 18 to pay off some of the national debt ... or some lollipops..."
MikeGG1 answered "We have still to get the details but they have also said that they will be saving on the cost of..."
Read more answers There’s also a good account aimed specifically at saving for children: The Children’s Regular Saver from Halifax pays a whopping 6% AER (fixed for a year) and any adult can open one of these accounts on behalf of any child.
On the downside, the amount you can save is relatively small - £10 to £100 per month - and this isn’t a flexible account: Any missed payments or withdrawals will result in the money being moved to a Save4It account, which pays a variable rate of just 1.05% AER.
However, several adults can each open one of these accounts for the same child; so if a few of you get together, the savings can really build up.
And this account offers a positive tax angle, too. An account opened in a child’s name is tax-free, providing the child doesn’t earn enough to pay tax!
Monday, May 24, 2010
Assets in 'dog' funds double over past year
The independent investment manager and financial adviser's biannual Spot the Dog report shows retail investor money in underperforming funds has jumped from £7.2bn in January last year and £13.72bn from the last report in October. The actual number of dog funds has also risen from 77 to 90.
Invesco Perpetual has £1.77bn of poorly performing assets across three funds and is the only group to have a ‘dog' product in the US sector. While the group sits atop the list, Bestinvest says it is confident Invesco Perpetual's "strong investment culture" will enable it to rebound.
Schroders sits in second place on £1.64bn, the same position it held in October 2009.
Andy Brough's Schroder Mid 250 makes another appearance in the Spot the Dog report. Bestinvest says it downgraded the Mid 250 fund in 2008 and believes the size of the vehicle has been a concern for some time. It says the fall in assets under management in the fund indicates many investors are also losing patience.
Rounding out the top five is Henderson on £1.21bn, Scottish Widows/SWIP £980m and F&C £852m.
Bestinvest senior investment adviser Adrian Lowcock says the rise in the number of dog funds is of greatest concern.
"It seems that more fund managers than ever before are underperforming their benchmarks and many investors are experiencing rank underperformance," he says.
"The upswing in the value of assets under management in dog funds highlights the huge number of assets being held in underperforming vehicles and the rise in the actual number of dog funds illustrates just how this is spreading across asset classes.
"It is vital that investors review their portfolios regularly to ensure they are getting the best possible returns."
Invesco Perpetual has £1.77bn of poorly performing assets across three funds and is the only group to have a ‘dog' product in the US sector. While the group sits atop the list, Bestinvest says it is confident Invesco Perpetual's "strong investment culture" will enable it to rebound.
Schroders sits in second place on £1.64bn, the same position it held in October 2009.
Andy Brough's Schroder Mid 250 makes another appearance in the Spot the Dog report. Bestinvest says it downgraded the Mid 250 fund in 2008 and believes the size of the vehicle has been a concern for some time. It says the fall in assets under management in the fund indicates many investors are also losing patience.
Rounding out the top five is Henderson on £1.21bn, Scottish Widows/SWIP £980m and F&C £852m.
Bestinvest senior investment adviser Adrian Lowcock says the rise in the number of dog funds is of greatest concern.
"It seems that more fund managers than ever before are underperforming their benchmarks and many investors are experiencing rank underperformance," he says.
"The upswing in the value of assets under management in dog funds highlights the huge number of assets being held in underperforming vehicles and the rise in the actual number of dog funds illustrates just how this is spreading across asset classes.
"It is vital that investors review their portfolios regularly to ensure they are getting the best possible returns."
Sunday, May 9, 2010
Employment can be solved by backing mid-sized firms
MID-SIZED companies hold the key to plugging the UK unemployment gap as public sector cuts loom, according to a leading economic forecasting group.
The Ernst & Young Item Club says that mid-sized companies are even more important than start-ups in creating employment, adding that it is vital that they receive backing from the government as employment in the public sector is set to shrink.
Bob Forsyth, head of strategic growth markets at Ernst & Young said: “Small start-ups have a vital role to play in creating new industries, but the most dynamic enterprises with the highest impact on our economy tend to be medium-sized firms that have spent several years laying the foundations for fast growth.”
Item Club has called on the government to provide a stable tax policy so that mid-sized companies can flourish.
Scott Halliday, managing partner added: “Stable tax policy that is pro-entrepreneur is important to economic growth and development. government can also encourage innovation by maintaining tax incentives for research and development.
The group also wants to see regulation simplified. “Complex regulation can, quite unintentionally, kill off innovation,” Halliday said.
The Ernst & Young Item Club says that mid-sized companies are even more important than start-ups in creating employment, adding that it is vital that they receive backing from the government as employment in the public sector is set to shrink.
Bob Forsyth, head of strategic growth markets at Ernst & Young said: “Small start-ups have a vital role to play in creating new industries, but the most dynamic enterprises with the highest impact on our economy tend to be medium-sized firms that have spent several years laying the foundations for fast growth.”
Item Club has called on the government to provide a stable tax policy so that mid-sized companies can flourish.
Scott Halliday, managing partner added: “Stable tax policy that is pro-entrepreneur is important to economic growth and development. government can also encourage innovation by maintaining tax incentives for research and development.
The group also wants to see regulation simplified. “Complex regulation can, quite unintentionally, kill off innovation,” Halliday said.
Monday, April 26, 2010
Customers 'happy with their bank'
The vast majority of consumers are happy with their bank despite the bad publicity the sector has endured in recent years, a survey showed.
Around 92% of people have not changed banks during the past two years, with 93% of these claiming they are happy with the service they receive, according to the BBC.
Only 8% of the 1,001 people questioned had switched accounts, with reasons for doing so ranging from getting better rates and wanting to take advantage of introductory offers, to problems with customer service and a lack of local branches.
Only 36% of those who had changed their provider cited the stability of banks during the recession as the reason they switched accounts.
But despite those who have stayed with their bank saying they were happy with the service they received, the survey also uncovered signs of apathy among consumers.
Half of those who had not changed banks said they thought all current accounts were the same, despite the fact that the interest available on them ranges from 0.01% to 5%.
A further 48% said they thought switching accounts would create too many problems, while 38% thought there were not any better or more appealing accounts available and 30% said they did not have time to compare products.
Banks have endured a raft of bad publicity recently due to complaints about the fairness of unauthorised overdraft charges, the mis-selling of controversial payment protection insurance and the problems the sector has faced during the credit crunch.
The Financial Ombudsman Service recently said complaints about the top five high street banks accounted for more than half of all of the complaints it received during the second half of 2009.
However, the British Bankers' Association (BBA) was quick to point out that the high level of complaints received about banks reflected the high level of transactions the sector carried out each day.
Read more: http://www.belfasttelegraph.co.uk/breaking-news/uk-ireland/customers-happy-with-their-bank-14753491.html#ixzz0mCDv4h1S
Around 92% of people have not changed banks during the past two years, with 93% of these claiming they are happy with the service they receive, according to the BBC.
Only 8% of the 1,001 people questioned had switched accounts, with reasons for doing so ranging from getting better rates and wanting to take advantage of introductory offers, to problems with customer service and a lack of local branches.
Only 36% of those who had changed their provider cited the stability of banks during the recession as the reason they switched accounts.
But despite those who have stayed with their bank saying they were happy with the service they received, the survey also uncovered signs of apathy among consumers.
Half of those who had not changed banks said they thought all current accounts were the same, despite the fact that the interest available on them ranges from 0.01% to 5%.
A further 48% said they thought switching accounts would create too many problems, while 38% thought there were not any better or more appealing accounts available and 30% said they did not have time to compare products.
Banks have endured a raft of bad publicity recently due to complaints about the fairness of unauthorised overdraft charges, the mis-selling of controversial payment protection insurance and the problems the sector has faced during the credit crunch.
The Financial Ombudsman Service recently said complaints about the top five high street banks accounted for more than half of all of the complaints it received during the second half of 2009.
However, the British Bankers' Association (BBA) was quick to point out that the high level of complaints received about banks reflected the high level of transactions the sector carried out each day.
Read more: http://www.belfasttelegraph.co.uk/breaking-news/uk-ireland/customers-happy-with-their-bank-14753491.html#ixzz0mCDv4h1S
Tuesday, March 30, 2010
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