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Mortgage borrowing reaches record £11.8billion high in a month

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Mortgage borrowing reaches record £11.8billion high in a month as housing market is fuelled by stamp duty holiday and low mortgage rates

  • Figures show net mortgage borrowing is at the highest since records began
  • Housing experts say home owners are taking advantage of low mortgage rates 
  • The break from stamp duty is also sending borrowing soaring across the UK 

Net mortgage borrowing reached a record £11.8 billion in March – the highest figure since records began.

Data released by the Bank of England shows that borrowing peaked in the same month that one in six homes were sold for above asking price.

Experts have said it shows that home owners are taking advantage of low mortgage rates to improve their properties. 

The high amount of lending comes from a total of 82,700 mortgage approvals that were made to home buyers in March.

Mortgage borrowing is now at the highest it's ever been since records began 28 years ago (shutterstock)

Mortgage borrowing is now at the highest it’s ever been since records began 28 years ago (shutterstock)

The number of mortgage approvals is lower than the recent peak of 103,100 in November 2020, showing that amounts being borrowed is soaring.

One in six homes sold for above asking price last month – the highest proportion for seven years as house market shows no sign of cooling 

One in six homes were bought in March for more money than the amounts that sellers were originally asking for, according to estate agents.

It marked the highest proportion of homes selling for above the asking price in about seven years.

The number of sales agreed was also the highest for the month of March since 2007, NAEA (National Association of Estate Agents) Propertymark said.

An average of 12 sales were agreed per estate agency branch – the highest figure for March since 2007 when the number was also 12.

More than a quarter (27%) of sales in March were made to first-time buyers – the highest figure since June 2020.

Households continued to pay back more than they borrowed in March for non-mortgage lending too.

A net consumer credit repayment of £535 million was recorded, including people’s borrowing using credit cards, personal loans and overdrafts.

The stamp duty holiday was due to end in March but was extended, which is also considered to be a contributing factor.

And in April, a string of lenders launched 5% deposit mortgages as part of a Government-backed scheme.

Mark Harris, chief executive of mortgage broker SPF Private Clients, said: ‘The strength of the runaway housing market is being reflected in the mortgage data, with strong levels of borrowing in March. 

‘With home owners borrowing an additional £11.8 billion, taking net borrowing to its strongest level since the series began in 1993, those who are not moving are taking the opportunity to improve, with cheap mortgage rates helping them make this decision.

‘With the stamp duty holiday originally expected to end in March, this focused borrowers’ minds and helps explain the uplift in lending. 

‘Now that this has been extended we expect activity to continue to be brisk over coming months, particularly as mortgage rates are likely to remain low and with increased availability of high loan-to-value deals.’

Another expert speculated that lenders are giving more ahead of an expected slow-down.

The number of mortgage approvals is lower than the recent peak of 103,100 in November 2020, showing that amounts being borrowed is soaring (shutterstock)

The number of mortgage approvals is lower than the recent peak of 103,100 in November 2020, showing that amounts being borrowed is soaring (shutterstock)

Simon Gammon, managing partner at Knight Frank Finance, said: ‘The property market is red hot as home seekers that put off moves during the worst of the crisis are now out-buying. 

‘Brightening economic sentiment alongside big changes to styles of working and living and limited stock availability is a potent mix likely to drive activity and house prices well into the summer months.

‘We do expect activity to begin slowing at that point. We’re already seeing more houses put on the market that will redress the supply imbalance and activity will naturally slow as the bulk of buyers that put off moves find new places to settle.

‘The lenders know this and are taking the opportunity to build market share by offering competitive rates and increasing product choice.’

The news comes after it was reported that one in six homes were sold in March for above the asking price

The news comes after it was reported that one in six homes were sold in March for above the asking price

Jeremy Leaf, a north London estate agent and a former residential chairman of the Royal Institution of Chartered Surveyors, said: ‘Buyers are determined to move even though many know the logjam in the system will mean they won’t be able to take advantage of the stamp duty concession before the tapering begins at the end of June.

‘Looking forward, we don’t expect much to change although prices will probably soften rather than correct as more people’s requirements are satisfied and balance between supply and demand returns.’

Records for mortgage borrowing began in April 1993, under the Bank of England’s Money and Credit department.  

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British ex-pat, 67, is forced to DESTROY his Spanish home two months after his wife died from cancer

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A British ex-pat has been forced to knock down his £130,000 Spanish home two months after his wife died from cancer.

But the situation for 67-year-old Gurney Davey, from Suffolk, could get worse because he is facing six months in prison after a mayor illegally gave him planning permission for the house.

‘I was distraught at first, my blood pressure was sky high and then I lost my wife,’ Mr Davey said this week as he was demolishing his home near Tolox, Malaga.

Gurney Davey, 67, has been forced to knock down his £130,000 Spanish home two months after his wife died from cancer

Gurney Davey, 67, has been forced to knock down his £130,000 Spanish home two months after his wife died from cancer

Despite Friday’s demolition also costing him €1,600, he added that it had actually come as ‘some sort of relief’ having fought the legal battle since 2004, over the house he built in 2003. 

It was then that legal firm, Manzanares, informed him he would be getting a licence for an ‘almacen’ (or storeroom), which would allow him to build the house.

‘We thought we had done everything right. We got legal advice and went through a lawyer in order to get permission to build the home,’ Davey explained. 

But he was later told that his house was one of around 350 that were illegally given planning permission by the former mayor, Juan Vera, who was eventually handed a prison sentence of his own.

Mr Davey was told his house had to be demolished for himself to avoid a six-month prison sentence, with the news coming just after his wife, Diana, died from bowel cancer at the age of 71.

‘Diana fought breast cancer for six years before bowel cancer – I am sure the stress brought it on.’ 

‘But thankfully it is now over,’ he explained. ‘It has been going on for so long now, I’ve finally come to terms with what needs to be done. 

‘Having it demolished was actually a relief,’ he added.

As he still owns the land, he can still live on it – just not in a house.

Despite Friday's demolition also costing him €1,600, he added that it had actually come as 'some sort of relief' having fought the legal battle since 2004, over the house be built in 2003. Pictured: Mr Davey's home in Spain before it was demolished on Friday

Despite Friday’s demolition also costing him €1,600, he added that it had actually come as ‘some sort of relief’ having fought the legal battle since 2004, over the house be built in 2003. Pictured: Mr Davey’s home in Spain before it was demolished on Friday

Mr Davey was told that his house was one of around 350 that were illegally given planning permission by the former mayor, Juan Vera, who was eventually handed a prison sentence. Pictured: Mr Davey's home in Spain after it was demolished on Friday

Mr Davey was told that his house was one of around 350 that were illegally given planning permission by the former mayor, Juan Vera, who was eventually handed a prison sentence. Pictured: Mr Davey’s home in Spain after it was demolished on Friday

Now, the father-of-three is planning a minimalist life staying in a converted van, so that his five dogs still have the space to roam.

‘This land is my home, it is my life and these dogs are all I have left.’

Whether or not he still faces a prison sentence, is yet to be confirmed.

The ex-pat only found out about the potential six-month sentence when a court document was delivered to a neighbour’s house.

‘I went straight to Tolox town hall with it. They told me I shouldn’t have received it yet,’ he recalled. ‘They said they were going to be sending the notification to me once they had stamped it.’

He had never been told about the court case that followed on from a Guardia Civil denuncia for an ‘illegal build’, but Davey’s two-bed home should never have been built according to the Malaga court.

Now, the father-of-three is planning a minimalist life staying in a converted van, so that his five dogs (pictured) still have the space to roam

Now, the father-of-three is planning a minimalist life staying in a converted van, so that his five dogs (pictured) still have the space to roam

In 2016, and then again in 2017, Davey was ordered to knock down his house, but, in common with a neighbour, he waited for more details.

While his Spanish neighbour, Irene Millan, 29, did eventually hear from the court again, she was given six months to ‘legalise’ her property – an option Davey was never given.

However, his neighbour’s apparent good luck turned into a poisoned chalice.

Having spent €20,000 with the town hall to legalise the dwelling, the court finally refused to accept the new paperwork provided by the council.

Instead, demolition was ordered – which went ahead last week.

To add insult to injury Irene’s 54-year-old father, Manuel Millan, whose name was on the deeds, was also sentenced to six months jail and handed a fine of €6 a day for a year.

Whether or not he still faces a prison sentence, is yet to be confirmed. The ex-pat only found out about the potential six-month sentence when a court document was delivered to a neighbour's house

Whether or not he still faces a prison sentence, is yet to be confirmed. The ex-pat only found out about the potential six-month sentence when a court document was delivered to a neighbour’s house

As he still owns the land, he can still live on it - just not in a house. Pictured: Mr Davey, a former builder, uses a JCB digger to demolish his own home

As he still owns the land, he can still live on it – just not in a house. Pictured: Mr Davey, a former builder, uses a JCB digger to demolish his own home

The couple, originally from Suffolk in the UK, spent £130,000 building their property.

‘It came as a package – a plot with a new home on it.’

Davey admits he and his wife were perhaps naive to follow the advice of their lawyer.

The lawyer, from legal firm Manzanares, told them that planning permission would be applied for as an almacen – or ‘warehouse’.

Mr Davey (pictured) was told his house had to be demolished for himself to avoid a six-month prison sentence, with the news coming just after his wife, Diana, died from bowel cancer at the age of 71

Mr Davey (pictured) was told his house had to be demolished for himself to avoid a six-month prison sentence, with the news coming just after his wife, Diana, died from bowel cancer at the age of 71

This way it would come under the remit of Tolox town hall, which would give permission and later they could ‘legalise’ the property.

The language of one legal letter suggests this would be a mere formality, but the property never got legalised.

In fact, the Tolox mayor of the time, Juan Vera, has since been jailed and fined for his part in a scheme.

In most cases the mayor used the very same ‘lax’ procedure of applying to build an ‘almacen’ to try to keep the prying eyes of the Junta authorities away.

‘We thought that was the way things worked in Spain,’ said Davey, a retired builder. ‘We went to see a lawyer and got advice. It turns out that was not the smart thing to do.

‘Why would we deliberately try to build illegally? It makes no sense that we would sell up everything in the UK and risk it all.’

Mr Davey had earlier said that he was forced to ask the town hall for permission to knock his own property down.

‘I will do it myself. I will borrow a JCB from someone and flatten my home of the past 17 years. I will not let the town hall do it and charge me more money.’

It is not the first time British expats have had their homes demolished in Andalucia, with the Priors, in Almeria, the most famous victims.

They still live in the garage of their house today, over 10 years since the house was knocked down in Vera. 

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Two teenagers died after separate incidents in Dublin and Waterford

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Two teenagers have died after separate incidents in Dublin and Waterford on Wednesday.

Gardaí in Ballyfermot responded to a call at an equestrian centre at Tay Lane, Co Dublin, at about 2pm.

Dublin Fire Brigade and the National Ambulance Service attended the scene and provided medical assistance to a 15-year-old girl who was injured during an exercise event.

She was removed to Children’s Health Ireland at Crumlin, where she later died.

Gardaí said the coroner has been notified. The Health and Safety Authority (HSA) has also been notified and will carry out an examination on Thursday.

Gardaí said investigations are ongoing. A file will be prepared for the Coroner’s Court.

Separately, gardaí and emergency services attended the scene of a workplace accident in Dungarvan, Co Waterford on Wednesday afternoon.

A boy was pronounced dead at the scene.

The HSA has been notified and will carry out an investigation. A file will be prepared for the coroner.

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Tritax EuroBox acquires Swedish logistics property for €47m

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Tritax EuroBox continues to expand its presence in the Swedish market with a €47m acquisition. The asset held freehold has a total gross internal area of approximately 28,900m² and comprises two purpose-built logistics facilities (one of 16,200m² and the other 12,700m²), located in the heart of the prime logistics location in the Port of Gothenburg. 

 

The Port of Gothenburg has been ranked as the most attractive logistics location in the Nordics for 20 years by Intelligent Logistik, the leading Nordic logistics media platform. There are currently no vacant logistics buildings in the port area. The Port is home to Scandinavia’s largest container terminal, which is forecast to grow over the coming years. The buildings are fully let to Agility AB, Nordicon AB and Vink Essaplast Group AB, generating a total annual rent of €1.79m on leases with a weighted average unexpired lease term of six years.  The rent reflects a rate of €62.50psm per annum.  All leases are annually indexed to 100% of Swedish CPI.

 

Nick Preston, Fund Manager of Tritax EuroBox, commented: “We are delighted to acquire our first asset in the Nordics which aligns with our disciplined investment approach and our long term strategic goals. The asset held freehold is located in the region’s strongest logistics market and offers asset management upside through working closely with the occupiers to achieve their business plans and increase rents to market levels. We expect to see continued strong market rental growth in the Port of Gothenburg, due to the natural constraint of land supply in the port area, and the increasing demand from occupiers. The Port of Gothenburg has a clear plan for growth, with significant infrastructure investment committed, further strengthening this location.”

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