What the papers say - 6th and 7th September 2008

The weekend financial pages were primarily concerned with the Government’s attempted housing market rescue plan, with articles on stamp duty, homebuyer schemes and the Bank of England base rate top of the agenda. The Daily Telegraph insisted that homebuyers must decide whether to take advantage of the temporary increase in the Stamp Duty threshold to £175,000, announced by the Government this week, or wait and see if house prices fall further. The Sunday Times revealed that city analysts expect the bank to cut rates by 1% or more over the next year as it seeks to stave off recession, while market experts urged first time buyers to wait for house prices to fall further. The current media consensus is that rates will improve and prices will continue to fall, which signals hope for millions of potential buyers.

Elsewhere, the Financial Times reported that professional landlords who are active buyers in the lower end of the market, are the best placed to take advantage of the new stamp duty exemption. Experts believe that shaving the transaction costs will only sharpen their appetite, if the right property can be found at the right price. The Observer looked at whether it is worth paying a high arrangement fee for a lower mortgage rate, whilst the Mail on Sunday revealed that some lenders have ‘toughened up’ their affordability calculators.

Finally, the Skipton Building Society’s ‘Mutually Exclusive’ loan scheme, which offers a high 95 per cent loan-to-value mortgage came under fire from critics because in order to secure the deal, parents of the first-time buyer must lock away savings equivalent to 20 per cent of the property’s purchase price.

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