Is It the Right Time to Sell Your Home?

With the UK housing market riding higher than it has in years, this week on the Kiran Trivedi blog I ask whether it is the right time to sell your home.

The Rise and Rise of the UK Housing Market

The housing market’s a world away from where it was a few years ago in the wake of the financial crash. The UK’s astounding economic recovery, along with government schemes like ‘Help to Buy,’ have persuaded people to let go of their reservations and jump back on the property ladder.

And the figures certainly back it up. According to data from HM Revenues and Customs (HMRC), home sales are rising. Specifically, HMRC has noted that a total of 100,360 homes were sold in May, up from 95,600 in April; hitting their highest level of 2014 so far.

Mortgage Approvals Are Down… Again

So more homes sold logically suggests more people are buying; but is this set to continue. Not according to the British Bankers Association (BBA). Last week, the BBC reported that the BBA suggested that the "heat is coming out of the housing market."

The Association argued that despite the record number of current house sales, mortgage approvals – an indicator of the trajectory of the housing market – were down. Specifically, mortgage approvals slumped to 65,132 in May, down for the fourth consecutive month, and measured 3.5% lower in total than in the same month of last year.

The Mortgage Market Reviews Are making it Harder to Buy Homes

Chief economist at the BBA, Richard Woolhouse, attributed dropping mortgage approval figures to the introduction of Mortgage Market Reviews; new affordability tests for home loan applicants.

Woolhouse argued that: "These are the first mortgage approval figures we have seen since the introduction of the Mortgage Market Review, so it is significant they have fallen for the fourth month in a row."

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Is Your Overdraft Good Value for Money?

Whether we like it or not, Kiran Trivedi readers, we all occasionally need to dip into our overdrafts to balance the books. But is your overdraft good value for money? Well according to the Financial Conduct Authority (FCA), it isn’t.

The thing about overdrafts is that no one wants to dip into them; it leaves you owing money and unless you have a student or post graduate overdraft, you’re most likely going to have to pay a charge for that service. However sometimes you have to, just to make it through the month. But is your overdraft leaving you worse off?

Overdrafts “Complex and Opaque”

The FCA has come out this month and put the whole lender overdraft culture into the spotlight, by suggesting that it is “complex and opaque.” What they mean by this, is that they are hard to understand, which means that because customers don’t necessarily understand the rules, they are vulnerable to losing money.

They’ve estimated that customers have lost in excess of £8 billion to banks and building societies through complex overdraft rules, and now the financial body has decided to launch a deeper investigation into the issue over the summer. Watch this space to see how it plays out.

The FCA has been reported to have said on the issue by news sources that: “Even the most astute consumer could struggle to understand what they are paying for" when it comes to an unarranged overdraft. So what should you do to tackle this problem?

Kiran Trivedi’s Guide to Handling Overdraft Issues

As long as you stay informed and you keep on top of things, there’s actually quite a few things to control the situation with your overdraft. These are:

• Research: Before you agree to anything, do your research. It’s a very competitive market out there at the moment, especially with the economic recovery,  and if you look around, you’re sure to find the right overdraft option for your personal finances
  
• Read the Fine Print: Lenders don’t exactly like to advertise the more unpleasant parts of their overdraft facilities, so they’ll usually stick it all in the fine print. Make sure you read carefully before you sign.
  
• Budget: An overdraft really should be a last resort; you shouldn’t be dipping into it to fund things like shopping sprees. Carefully budget so that you only need to use it in cases of emergency.
  
• Get Help: If you think you’ve been hit with unfair overdraft charges, and the bank are ignoring you, contact the FCA. Now is literally the perfect time, as they’re actually investigating the matter. 

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