Tag: homeowners

Safe as houses: Which? annual mortgage survey reveals best and worst mortgage lenders

First Direct and Nationwide have come out on top in Which?’s annual mortgage lender survey, with both named Which? Recommended Providers (WRPs) for offering a combination of excellent customer service and consistently competitive rates. 

With speculation that interest rate rises could be on the way, it is more important than ever that prospective homeowners and remortgagers do their research and find the right deal and provider. 

The consumer champion surveyed more than 3,500 homeowners and analysed thousands of mortgage deals to find which providers offered impressive customer service and the best rates. 

Lenders were scored on multiple aspects of customer service, including: keeping customers informed, clarity of mortgage statements, transparency of charges or penalties, dealing with queries and complaints, flexibility of payments, online access and value for money. 

First Direct came out on top, receiving an impressive customer score of 81 per cent. Its customers gave it five stars across the board, and the lender consistently offered some of the cheapest deals on the market. 

Nationwide earned an overall customer score of 77 per cent and was also named a WRP for the eighth year in a row. The building society achieved five-star ratings for value for money and clarity of its mortgage statements.

Coventry Building Society received the joint-top score of 81 per cent, achieving five stars for customer service, clarity of mortgage statements and keeping you well informed, among others. However, it missed out on becoming a WRP because it did not offer enough market-leading deals. 

Royal Bank of Scotland received the lowest score in this year’s survey, with an overall customer score of 64 per cent. RBS received three stars for its general customer service, flexibility of payments and online access, among other criteria. 

While nearly nine in 10 (87%) respondents told the consumer champion that they were satisfied with their mortgage provider, a quarter (24%) said they had had a problem with their lender. The most commonly cited issues included poor customer service, a lack of flexibility on payments and poor interest rates. 

When asked why they chose a lender, around one in five (21%) respondents said the size of monthly repayments was important, while the same number said the overall cost of the deal was key. One in six (16%) respondents said an existing relationship with the lender (for example, having a bank account with the provider) was a key factor. 

Seven in 10 (72%) of survey respondents had a capital remortgage payment plan. However one fifth (20%) had interest-only mortgages. While the majority of respondents with interest-only mortgages had a plan for repayment at the end of the term, worryingly 9 per cent said they did not know how they would repay their loan – meaning they could be forced to sell their home at the end of the term to repay the balance.

Gareth Shaw, Head of Which? Money, said: “Buying a house is the most expensive purchase most of us will make in our lifetime, so finding a mortgage deal that’s right for you is essential – especially when the outlook for interest rates in the year ahead is uncertain. 

“Recently, we’ve seen reputable lenders offering record-breaking low rates, meaning it’s possible to find a deal that combines value for money with great customer service. As ever, doing a bit of research and talking to a whole-of-market broker before committing is likely to pay off.”

Half of Edinburgh homeowners undervalue their homes by more than £28,000

Zoopla reveals the capital’s ‘Hidden Equity’

  • Half of Edinburgh’s homeowners undervalue their home by an average of £28,351
  • Two thirds of homeowners across Edinburgh have lost touch with the value of their home
  • More than half of homeowners in Edinburgh unlocked their ‘hidden equity’ to move to a nicer property

New analysis by Zoopla, the only property portal which offers a free instant online property price estimate, conducted as part of its inaugural Hidden Equity Survey, has found that homeowners in Edinburgh are undervaluing their homes by an average of £28,351.

The Hidden Equity Survey of 2,000 homeowners* who have had their home valued by an estate agent in the past three years establishes for the first time how accurate Edinburgh homeowners’ estimations of the value of their homes really are. It found that just one in three (33%) local homeowners have an accurate idea of the estimated value of their home.

Average home in Edinburgh worth £28,000 more than owners realise

The findings from Zoopla show that almost half of homeowners in Edinburgh (45%) who had their home valued via an estate agent or sold it in the past three years said it was worth more than they thought it was – on average by £28,351.

Bathroom bonus

When asked for their thoughts on why their homes were worth more than expected, two fifths (43%) of homeowners in Edinburgh attributed their good financial fortune to installing a new bathroom. Other popular reasons being given by homeowners in the city for their financial uplift included redecorating (41%) and work on the garden (32%).

Increasingly desired

The practicalities of improving a property aren’t the only reasons for homeowners in Edinburgh to get more for their home than they thought it was worth. Edinburgh becoming an increasingly desirable place to live has also helped to add value to the properties of homeowners, with a third (36%) of homeowners citing desirability of the city for homes being worth more than their owners expected.

The good life

For Edinburgh homeowners who went on to sell their home and benefit from their hidden equity, the financial boost had a significant impact, with the majority (84%) of homeowners saying the additional money ‘improved their lifestyle’. More than half (59%) said they were able to move into a better property than they expected as a result (for example, it had more bedrooms, was in a nicer area, had a garden etc.).

One in ten (12%) homeowners in Edinburgh used their extra cash to go on more holidays and a further one in ten (12%) gifted the money to their children to help their future plans.   

Different decisions

For Edinburgh homeowners who did not know the true value of their home until they got it valued by an estate agent, one in three (34%) said they would have made different financial decisions in the years prior if they had been aware of their hidden equity.

For property owners whose home was worth less than they expected, two fifths (43%) said they would have paid off more of their mortgage. Almost a third (29%) would have worked harder to build their savings rather than assume their home was accruing equity that they could draw on at a later date.

One in ten (14%) of homeowners in Edinburgh said they’d have spent less on non-essential purchases like jewellery, watches or expensive presents.

House prices rising

Zoopla has also revealed the latest House Price Index, which studies multiple local housing trends and prices on an annual basis. The data shows that the average house price in Edinburgh is now £241,000, with prices rising by 2.8% in the last 12 months. The data also shows prices in Edinburgh have increased cumulatively by 24.4% in the past five years.

Gráinne Gilmore, Head of Research at Zoopla, comments: “The direction of house prices has long been a staple of conversation around dinner tables across Edinburgh and many homeowners could be in for a lovely surprise if they have their property valued, according to our research.  

“Because of the impact of the pandemic, many households are re-evaluating how they want to live and this has had an impact on the local housing market. Buyer demand has soared, racing ahead of supply, putting upwards pressure on prices. House price growth in Edinburgh is currently at 2.8% annually.

“Edinburgh homeowners keen to check up on their property’s value should head to Zoopla’s My Home, where they can see an estimated value range for their property and check for potential hidden equity.

“For those keen to progress with a sale and perhaps unlock hidden equity, they can contact an estate agent using My Home to get an expert market valuation and personalised guidance on how to best navigate this busy housing market.”

Staying on top of a property’s value

As a first step, homeowners can check My Home on Zoopla.co.uk, where they can discover their home’s worth with an instant online estimate based on powerful market data. They can also keep track of their house price estimate and access a timeline of their home’s sales history.

My Home also allows homeowners to track the estimated value of other homes in their neighbourhood, as well as homes they might want to buy in the future. Zoopla is encouraging homeowners to get estate agent valuations of their home – the most accurate way to value a property – to see if they are sitting on more equity than they think.