For more information contact your financial advisor at Thameside Associates on 01932 223870
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Thameside Associates
January 2018
In the year to June 2017, 197,000 people in England obtained planning permission to improve their homes, with a further 23,700 adding extensions under permitted development rights. The figures suggest that, on average, one homeowner was extending or improving their property for every five who were buying a home.
How much value you can add by having a new kitchen or bathroom, or adding a bedroom depends on various factors. However, recent research by a major insurer shows that converting a single garage into a room could add as much as 20% to your home’s value, and building a loft extension could add around 15%.
Although it restricts the size of the garden, a conservatory provides more living space and could add around 7% in value. Painting and decorating the exterior and tidying the garden could add a further 10% to the value. Replacing worktops, cupboard doors and flooring can also make a home more saleable.
Over £43 million pounds has been lost to pension fraud since the new legislation came into force in 2015, with some people losing all their retirement savings. Action Fraud, the UK’s national reporting centre for fraud and cybercrime, is warning of new scams.
The first is a letter sent to fraud victims, claiming to be from the National Fraud Intelligence Bureau, offering to return the money they lost. It asks for the victim’s bank account details. Those providing these details have had money taken from their accounts instead.
The second scam concerns rogue pension websites that are carrying anti-scam messages to trick consumers into believing they are legitimate businesses. These sites can often look genuine, but often offer either unsuitable or non-existent investment opportunities. Always seek professional advice when you need help with your pension.
A committee of MPs is currently investigating whether more needs to be done to clampdown on pension scammers.
Landlords facing higher interest rates, increased stamp duty and the loss of their buy-to-let tax breaks are passing on these increases to their tenants in the form of rent rises.
Since April 2017, landlords have faced new tax changes, and have been restricted to deducting 75% of their mortgage interest from the rent they receive before applying tax. Previously, they could deduct all their mortgage interest from the rent they received and pay tax on the remainder. The rules are being tightened gradually until 2020-21, when landlords will not be allowed to offset any of their mortgage interest payments from their profits.
Data from the Association of Residential Lettings Agents suggests that these changes are already filtering through to the lettings market. In November 2016, only 16% of agents saw landlords increasing rents, but that figure had risen to 35% by November 2017, and is widely expected to rise further.
Taking out a mortgage is a major step, particularly when you consider the size of the loan you’re committed to repay. It brings with it the need to take a longer-term view of your finances and think about the potential consequences for your family if unforeseen events were to intervene. Getting a mortgage is often a time when people think about taking out insurance policies to protect their family. There is something very reassuring about knowing that if the worst should happen, your family wouldn’t be burdened with money worries at a sad and difficult time. And it’s not a decision you should delay; as you get older the premiums will increase in cost.
Don’t delay
Family life can be expensive these days. For many families, the cost of making their monthly mortgage repayment takes up a sizeable portion of their income. If you have dependants – such as school-age children, a partner who relies on your income, or a family living in a house with a mortgage that you pay, then you should seriously consider taking out life assurance to provide a lump sum in the event of your death. This could make a huge difference as to how financially secure your family would be; no-one would want to leave their loved ones facing hardship.
Your home may be repossessed if you do not keep up repayments on your mortgage. As with all insurance policies, conditions and exclusions will apply.
What rate do you currently pay on your mortgage? If that question had you stumped, you are not alone. One in three borrowers was unable to give the correct answer in a recent survey. With interest rates having been low for some years, many people have been content to stay with their current lender as their monthly repayments have remained affordable.
However, you need to keep an eye on your mortgage, especially if interest rates change or your current deal is nearing its end, to ensure you’re getting a good deal. Taking professional advice will help you make the right choice, and will save you the time, trouble and stress that goes with researching alternative deals.
If your current fixed-rate, tracker or discount deal is about to end or has already ended, it’s usually the case that you’ll be moved to your lender’s Standard Variable Rate (SVR). The SVR is usually pegged to a percentage above bank base rate and can be subject to change by the lender. So, if you don’t do anything, you could be vulnerable to interest rate rises when they come.
However, you could potentially save a substantial amount by moving your mortgage to a more attractive rate, either with your existing lender or to a different lender. If you’re concerned about the impact that another rate rise might have on your finances, then it’s a good idea to set up a mortgage review.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Thameside Associates
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Office: 01932 223870
Terminal House Station Approach Shepperton, Middlesex TW17 8AS