29 Nov 2017 With Brexit anxiety, interest rates on the up and house prices expected to stall, the current property market is a minefield for anyone looking to buy in the UK. Despite this uncertain time, the desire for Brits to get on the property ladder is still strong, especially among those in their 20s.

SpareRoom.co.uk survey of more than 5,000 British renters found that 86% of 20-somethings said they want to get on the property ladder, with 52% wanting to do so in their twenties. The vast majority of those (87%) said the main motivator is to pay into their own home, rather than lining their landlord’s pocket.

But the bank of mum and dad isn’t an option for most. 87% of 20-somethings said they intend to save a deposit from their salary, with just 1 in 3 anticipating help from parents.

With the average UK salary standing at £27,600 (£34,473 in London) and the average house deposit at £33,000 (£106,577 in London), people saving the average 5.9% of their income outside of London (around £108 a month) would need to do so for 25 years to accumulate a deposit. And those buying in London, saving an average of £131 a month, would need to save for a staggering 68 years to save up the deposit. This means buying in their twenties is an unachievable dream for most, even with the stamp duty relief announced in the recent Budget.

The findings uncover the extremity of the situation, with 93% of London flatsharers in their 20s saying they may have to leave the capital to buy a house and 87% across the UK are facing the prospect of leaving the town/city they call home in order to buy.

In contrast, people who are forty plus are far less bothered about owning. 29% said they don’t think owning is important, compared with 10% of people in their twenties and 15% of people in their thirties.

This piles on the pressure to find a high paying job to save a deposit and, even then, affordability is still a huge issue, as a quarter (25%) of twenty-somethings who bought and then sold a property said this was because they could no longer afford it.

Personal Finance expert Andrew Hagger from Moneycomms commented on the findings: “Buying a house isn’t a fool proof money maker. The UK’s property market is far less certain than just 18 months ago, and buyers are faced with rising inflation and interest rates. House prices are also stalling and in London there’s signs they’re falling. This may seem like good news to first time buyers but, if the trend continues, there’s a strong possibility people will end up trapped in negative equity.

“The financial pressure of buying a house isn’t just the deposit and the monthly mortgage repayments. If anything goes wrong, you have to pay for it and this can be a huge cost. Young people need to consider whether they can truly afford this without getting into difficulty. Buying a house in your twenties ties you to a long-term responsibility that can be tricky to get out of.

“Property can be a great investment, but you need to weigh up whether the potential profits currently outweigh the risk of ending up in negative equity. This is a decision that should not be rushed.”

Matt Hutchinson, director, SpareRoom comments: “Ownership is undeniably the wise long-term option for those who can afford it. But people in their twenties are putting too much unrealistic pressure on themselves to get on the property ladder. Renting ought to be the perfect choice in your twenties, leaving you flexible to move around, travel, change jobs or find a partner to settle down with. But we’ve become so terrified of missing out on the long term financial benefits of owning, buying feels like the only option.

“Brits have been force fed the notion by successive governments that buying is the right thing to do. But it’s not currently the realistic thing to do, leaving millions of people feeling locked out of financial security and like they’re a failure. That’s just plain wrong.”

If 82% of people think they’ll have to move to another area in order to buy then our housing market is failing us. Our homes should be secure, comfortable, affordable platforms for us to lead happy and productive lives. Instead they’ve become financial assets, investments, pensions and, for a whole generation, nothing more than a pipe dream.”

28 Nov 2017   Homeowners who have been a victim of a break in are two and a half times as likely, as someone who hasn’t, to be targeted again, according to Co-op Insurance’s latest claims data.

Furthermore, for those homeowners who are unfortunately targeted a second time, Co-op’s claims data reveals this is approximately 16 months after the first break in took place.

Highlighting a need to make homeowners feel more safe and secure at home, research among a panel of homeowners conducted by the Co-op shows that two fifths (38%) feel nervous at the thought of someone unexpected approaching their door.

Over a tenth  said they wouldn’t answer the door if this was the case and a further 12% said they only answer their door to friends and family.

Co-op’s claims data also highlights that home break-ins are 43% more likely to occur in November and December, in comparison to the summer months.

In order to help these homeowners feel less nervous at the thought of someone approaching their door ahead of the Christmas period, Co-op is piloting providing smart, connected doorbells to customers who have been a victim of burglary, for a period of 6 months.

As a means of connecting communities, the doorbells allow homeowners or loved ones and neighbours on their behalf, to see and speak to anyone at their front door from anywhere, using their smart phone, tablet or PC, ultimately to help people feel safer.

The device, created by US start up Ring.com works by sending instant alerts to electronic devices when people press a doorbell or trigger the in-built motion sensors. Homeowners, loved ones or neighbours can speak to whoever is at the door, using the inbuilt speakers and microphone.

Caroline Hunter, Head of Home Insurance at the Co-op said: “Our claims data shows that people who are victims of home break-ins are more likely to be targeted again. We want to connect communities and provide tools for neighbours to easily keep an eye out for each other helping homeowners feel safer.

When we asked ex-convicts what would put them off attempting to break into a house, 89% agreed that ‘smart tech’ topped the list.

“For that reason, we’re now starting to provide these smart doorbells as a six month pilot to a proportion of our direct home insurance customers, who have had to claim for burglary.

“In addition to helping people feel safer, the device also allows homeowners to record activity, which, in the event of a break in, could be of use to the police and insurers.”

28 Nov 2017  More than one in five are saving or investing less because they cannot access advice on how to handle their money, new research for the Nottingham Building Society (The Nottingham) shows.

Its study found 21% of adults believe they are not saving as much as they could and would be able to put away an extra £134 a month on average if they could get financial advice – the equivalent of more than £1,600 or three weeks’ average earnings before tax**.

It is younger savers and investors who need the support with their finances the most, The Nottingham research shows. Nearly one in three (30%) of under-35s believe they are not saving enough because of a lack of advice compared with just 12% of the over-55s questioned.

The first base rate rise in 10 years combined with rising inflation is making the need for advice more important but The Nottingham’s research shows customers are struggling to get help. Around 20% say they have struggled to access advice on savings in the past two years and 11% have struggled to get advice on investments.

Banks and building societies are increasingly being considered as a potential source for independent advice – around 73% of adults say they would consider becoming a customer of a bank or building society which provided advice services. However, branch closures are making it more difficult to access advice, The Nottingham warns.

It has transformed its branch proposition to offer a wide range of financial advice-based services including support on savings products, and independent whole of market advice for mortgages and financial planning.

David Marlow, Chief Executive of The Nottingham said, “It is very worrying that people are missing out on saving and investing simply because they struggle to get independent advice.

“The recent rate rise and increased competition among providers means there is more choice than ever but at the same time people clearly need more help to decide what is right for them and their individual circumstances.”

”Branch closures are making it difficult for savers to get the advice they need to make major financial decisions.  As a mutual building society, we have a significant role to play in helping members to plan for the future which is why we are expanding our branch network and providing our unique combination of advice and service all available under one roof.

23 Nov 2017  Home insurance premiums are soaring as rising inflation increases the cost of claims while fraud escalates, new analysis from insurance market experts Consumer Intelligence shows.

Average home insurance costs rose 8.5% – nearly three times the 3% rate of inflation for the economy as a whole – in the year to October to £131.

Inflation is increasing the cost of repairs as claims for water leaks damage grow with more homeowners installing bathrooms and wet rooms. The rising cost of gold and diamonds is also hiking the cost of jewellery claims, while fraudulent claims are another issue, particularly among younger demographics, analysts say.

Consumer Intelligence – whose data is used by the Governments Office for National Statistics to calculate official inflation statistics – says average premiums in London are the highest at £168, 41% more expensive than the £119 in the South West of England.

Prices are rising fastest in the South East of England and Wales where premiums are up to 10.6% higher than last year while Scotland is seeing the lowest price rises at 5.6%.

Older homeowners (£127) now pay slightly less for their insurance than the under 50s (£133), with average premiums increasing 8.4% and 8.6% respectively, over the past year. 

Customers can take comfort from the fact that home insurance costs are still slightly lower than they were three years ago.  And owners of newer properties built after 2000 pay average premiums of £114 due to tighter building regulations. 

John Blevins, from Consumer Intelligence, said: “The home insurance market remains very competitive but customers can expect prices to continue to rise in line with inflation.

Claims costs are increasing but there is no one major factor driving the market. Some trends are emerging, however, including escape of water claims and the cost of jewellery claims driven by price increases for gold and diamonds.

“Fraud also impacts home insurance claims in a similar fashion to motor – although claims tend to be smaller in severity, but greater in frequency.”

20 Nov 2017  Co-op Insurance is urging motorists to be alert on the roads this Black Friday as its claims data reveals that motor incidents increased by almost a fifth (18%) on this day last year, in comparison to 2015 data.

Whilst ‘Black Friday’, due to fall on 24th November this year offers bargains galore to consumers, last year it led to an increase in motor accidents, collisions and theft claims according to Co-op Insurance’s claims data.

Nick Ansley, Head of Motor Insurance said: “Our claims data shows year on year that Black Friday’s sales do lead to greater traffic on UK roads and therefore more incidents. 

“Whilst drivers should take care all year round, unfortunately we do see an increase of road incidents on this day specifically and so we’re urging drivers to take care when out on the roads.”

Furthermore, Co-op’s claims data highlights that Cyber Monday due to take place on 27th November is becoming a safer day to drive on the roads for motorists as consumers opt in to online sales.

The insurer found that the number of claims from on Cyber Monday in 2016 decreased by over a tenth (12%) when compared to 2015 claims data.

20 Nov 2017  The average Brit has six jobs in their lifetime, according to new research by Investec Click & Invest released today.  However, those aged between 18 and 34 plan to only stay in their current job for an average of three years and four months, which equates to an average of 12.5 jobs during their working lives – more than twice the national average.

Millennials are most likely to be driven by wanting more money, a new challenge or career progression (all 35%).  This compares to older individuals, whose primary reasons for wanting to change jobs include being unhappy in their current role (33%), wanting to do something different (25%) or wanting to do something they are passionate about (24%),

Indeed, only a quarter of millennials stated that they would want to move because they were unhappy, while they are also less likely to want to move to have an easier job (4% versus 7% of over-35s) – dispelling the myth of the “lazy millennial”.

It is 18 to 34-year olds who also secure the highest proportional pay rise at 20.4% when they change jobs. While this is largely due to the lower average salaries earned by those starting their careers (£30,913), this still represents an increase of £5,235 – 64% higher than the national average pay rise.

Commenting on the findings, Jane Warren, CEO of Investec Click & Investec said:

“The days of a job for life have long been over and our findings show that younger people are keen to take control of their careers by switching jobs to meet their objectives, despite the greater insecurity this brings.  Against this backdrop, it is important that they save and invest to provide the certainty and security that may be otherwise missing.”

Investec Click & Invest (www.clickandinvest.com) is the new online investment management service for individuals with £10,000 or more to invest. Click & Invest combines the experience of a team of Investment Managers and over 180 years of wealth management experience with the convenience and ease of an online service, opening the door for individuals who wouldn’t usually be able to access traditional wealth management services.

15 Nov 2017  More than one in 10 Brits had to move home after being burgled, according to new research by home insurer Policy Expert.

The survey of 4,525 adults, which reveals the true cost of burglary, also found that a third had difficulty sleeping after the incident and almost 8% admit they couldn’t be left alone in the property.

Approximately 2.7 million homes in the UK have been robbed and, of those surveyed, the most common way burglars broke in was through a window (38%). Just under a third damaged a door, and one in seven (13%) tampered with the locks.

Whilst you’re more likely to be burgled when out of the house, a fifth admitted the incident happened when they were at home asleep. More than a quarter were at work, 18% were out shopping or socialising, and one in six were on holiday, revealing the crucial need for effective home security.

Adam Powell, Head of Operations at Policy Expert, commented: “Protecting our homes and belongings is vital, and there are a number of steps you can take to ensure that you are not a target for thieves. Opting for enhanced locks, windows and doors, or installing CCTV will help to avoid the chances of being burgled. Try and keep valuables, including keys and even Christmas presents, out of sight to avoid a potentially costly festive spell.

“In addition, while it may be tempting to post about holidays on social media, this might inadvertently advertise that your home is unoccupied. Burglars will typically go for smaller, more expensive items such as watches or jewellery, so check your single item limit and if you have a valuable that exceeds that, inform your insurer.”

 

Top tips from Policy Expert on protecting your home:

 

·         Enlist the help of a housesitter or ask a trusted neighbour with a set of keys to check in on your house every now and again if you’re away for an extended period of time

·         Install a timer to set lights inside your home to come on once it gets dark – choose a light in a visible room at the front of the house, not the hallway, as this will create the impression that someone is inside

·         Invest in sensor-activated, external lighting for the garden and around the front of the home

·         Install a burglar alarm – not only is this a visible deterrent, if someone does attempt to break in the alarm would alert neighbours and the police before any damage could be done

·         Don’t leave curtains closed – during the day this makes it look like there’s no-one at home

·         Make sure any outbuildings or sheds are locked and that any tools are hidden away – these could be used to break into your home

·         Ensure any valuables are out of sight – remove the temptation and make sure these items cannot be seen from outside the house through the windows

·         Never leave a spare key anywhere near the front door, for example under a doormat, flower pot – thieves know all the usual hiding places

·         Similarly, don’t store house/car keys just inside your front door, as burglars could try to fish for the keys through the letterbox

15 Nov 2017   New research from Charter Savings Bank shows how important savings are to retirement planning, as pensioners rely on their cash savings for up to a fifth of their annual income.

Its nationwide study found 77% of retired people use cash saving accounts to generate part of their income in retirement highlighting the importance of ensuring they have the most competitive rates.

On average, respondents say money from their savings – including withdrawals and interest – adds 19% to their annual income, demonstrating the significant contribution that saving regularly makes to the standard of living in retirement.

However, the research also found that less than half of pensioners regularly move their cash to achieve better rates. Despite growing competition among savings providers, just 46% of those surveyed said they monitor the market for the best rates.

Nearly two out of five of those questioned (37%) say they do not move their savings, while another 17% say they look for the best deals but do not move their money regularly.

Paul Whitlock, Director of Savings, Charter Savings Bank says: “Competition in the market is increasing with a wider range of providers offering a variety of competitive savings options.

Given the importance of savings to retirement income, it is safe to say that savers should be reviewing options regularly to look for the best deals. Alongside providing simple straightforward accounts and good service, we are focused on enhancing our range whenever we can.”

Around the country, pensioners in the South West lead the trend and are closely followed by Londoners with 94% and 84% respectively using their savings accounts to boost their income in retirement.

Across its nationwide sample, the research found that retired men are more likely to have savings accounts than women. 83% of those men said they increase their income with savings cash, compared with 72% of women. However, there’s less of a gap when it comes to moving accounts, as 49% of men switch regularly compared with 43% of women.

14 Nov 2017   38% of UK adults leave presents under the Christmas tree, making them visible and easy targets for opportunistic thieves, according to a new study released today by Co-op Insurance.

In fact, Co-op Insurance can reveal that home break-ins are 43% more likely to occur throughout November and December as the nights get darker and homeowners commence their Christmas shopping.

Despite the increased risk of burglaries, more than half (55%) of UK adults say they don’t consider the security implications of leaving presents under the tree.

Additionally, 45% of adults say they do consider the security risks, but enjoy the tradition of leaving presents under the Christmas tree despite this.

Other popular present hiding places include the wardrobe (33%), under the bed (9%) and in the garage or shed (5%).

In addition, UK adults are putting their security at further risk, as a third (31%) said they keep fairy lights on whilst not at home, placing even more spotlight on their valuable gifts  – not to mention the fire risk that this poses.

Caroline Hunter, Head of Home Insurance at Co-op Insurance commented: “It’s no surprise that more than two fifths of Brits uphold the long standing tradition of leaving presents under the Christmas tree as is custom for many households.

“Our advice is to store presents and other valuables in a secure location out of view from potential, opportunistic thieves. In the attic, under the stairs or in a large suitcase are good alternatives.”

“We also know that leaving a light on in the house is a key deterrent for burglars. However, fairy lights are a fire hazard and should not be left on whilst unattended. We would suggest leaving a landing light on when out of the house, or installing motion activated security lights. This gives the illusion that there is someone at home without risking safety.”

For peace of mind during the festive period Co-op Insurance automatically increases its customers’ contents cover by 10% in the weeks around Christmas and New Year to allow for the extra gifts and valuables in your home. For more information visit www.co-opinsurance.co.uk

10 Nov 2017 The cost of utilities has risen at almost triple the general rate of inflation for the typical UK household in the last 20 years, according to Tilney’s Household Inflation Index. The findings come as SSE and Npower announce their merger, following the government’s proposed crackdown on the soaring cost of energy bills.

Inflation, an increase in prices and associated fall in purchasing power, is calculated by looking at the changing prices of the items in an average household’s basket of goods and services. From 1997 to the end of 2016, while the total inflation for a typical household’s entire basket of goods was 50.7%, the cost of utilities jumped by 139%.

While energy and water prices have shot up over the last two decades, the cost of clothing and shoes has halved, with prices falling by 49%, largely thanks to the rise in products being manufactured for cheaper overseas, in countries including China.

Another area where prices have risen fast, according to Tilney’s report, is alcohol and tobacco, which together saw inflation of 165% from 1997 to 2016. Housing costs, which includes the cost of buying property and maintaining homes, have risen by 98%, almost double the general rate of inflation, thanks to soaring house prices over the period.

How has inflation varied across different spending categories from 1997 – 2016?

Spending category Inflation experienced by typical UK household
Housing 98%
Utilities 139%
Food and drink (exc. alcohol) 49%
Alcohol and tobacco 165%
Clothing and shoes -49%
Households goods and services 20%
Health and personal care 45%
Transport 47%
Telephone and internet -4%
Entertainment and recreation -12%
Restaurants and cafes 85%
Holidays 89%
Total basket of goods 50.7%

The price of holidays and eating out have risen by 89% and 85% respectively in the last two decades, while food and drink (excluding alcohol) costs have risen by 49%, almost in line with inflation of the typical household’s basket of goods.

Other costs to have fallen over the two decades, along with clothing, are entertainment and recreation, which has deflated by 12%, and the costs associated with telephone and internet, which have fallen by 4%.

Since 1997, typical households have been hit hardest by the inflation of housing costs, the cost of running a car and the cost of insurance, due to the proportion of their spending devoted to these. Households will continue to feel the pinch from the cost of running a car, as average car insurance premiums have risen by 14.6% in the last year – five times faster than inflation.[2]

Andy Cowan, Head of Financial Planning at Tilney said: “Inflation is often seen as a single figure affecting all households in a uniform way, but price rises and falls have varied dramatically across different goods and services over the last 20 years. This means that individual households can experience inflation very differently, depending on what they spend their money on.

“In the case of the top 10% of UK households – those with an income in excess of £78,500 per year – our research found that they have endured considerably higher overall inflation than the headline figures while also being exposed to a much greater income tax burden than the wider population.  These households have needed to see their savings and investments generate a return in excess of 64% over the last two decades, just to stand still in real terms after the impact of inflation.

“This is where astute financial planning to maximise tax efficiency and an appropriate investment strategy designed to outpace inflation comes into play.  Soaring stock markets in recent years have rewarded investors but a squeeze on pension allowances and an uncertain economic outlook mean it is as important as ever to have a robust financial plan in place.”