“This petition asks the Government to change the investment rules for self-administered pension schemes to allow them to invest in residential property. This will benefit pensioners whose investment income has been hurt by the reductions in interest rates, by allowing them to invest in property which can be let at a higher yield. This will also help to stem the continuing loss of value in the property market, and stimulate activity.”

Please see ‘12 ways to kick-start the property market’ for more information on this issue. (To read this e-book, click www.barrettssolicitors.co.uk and then select E-BOOKS.)

We will contact you on the email address you give, to let you know what happens, or to ask any questions.

Buy to let mortgages still seem to be hard to find, and they’re not attractive when you do find them. Mortgage rates for buy-to-let are being offered at rates above 6%. On top of that, you may have to pay a fee up front of anything up to 3% of the loan in order to get a fixed rate.

Bradford and Bingley used to be the main buy-to-let lender but it seems that they are now so keen to get out of that market that they are trying to encourage customers to remortgage by waving early repayment charges.

So it may not be a market you can get into if you need a mortgage. But if you have cash, it seems to me that it may be a good market to be getting into at the moment.

To start with, I don’t know when exactly the top of the market was. In that same article the Buying Solution said that they go back to autumn 2007 to establish what a property was worth at the top of the market, and then reduce it by 20% to get a rough figure for what the property is worth now.

What I don’t understand is how they do this calculation. How do you compare properties? It’s not as if properties are like stocks and shares where you can compare values at different times for the same share. You can’t compare prices for the same property. So if you have a lot of different sized houses in different quality streets going at different times, how do you work out how much overall they have dropped in value? I am mystified, to be honest. I suspect even the people doing the calculations are mystified, because everyone seems to come out with completely different figures every time I look at the Press.

In another case, which doesn’t seem quite so fair, the tenants objected to having to pay a big service charge for some repairs which only cost so much because the landlord had neglected to do the repairs for several years. The law says a landlord can only recover a service charge amount which is “reasonable”. The flat owners’ argument was that it was unreasonable to let the damage mount up. Unfortunately, the court took the view that the only thing which had to be reasonable was whether the cost at the time was correct for the work needed, not whether the landlord was reasonable in not doing the work earlier.

I wouldn’t rely on a pesonal search in a HIP for a property we are buing for a client. We’ve come across ones where the search agents completely failed to spot the planning permissions.. So now we won’t even think of relying on a personal search in a HIP. We’re always going to get our clients to let us do a proper official search, or at least a personal search done through a genuinely reliable search provider – one who has been around for years, not someone trying to cash in on the HIPs gravy train.

When you come to the end of the fixed deal, not only do you risk an interest payment hike, but you may not be able to get a new fixed deal at all. The lenders may insist on a larger cash or value element than you have available.

The big danger is being stuck on a lender’s standard variable rate. It used to be the case that if the Bank of England cut its base rate, all the lenders cut their interest rates. But since the credit crunch, any interest rate cuts are not being passed on by lenders, because they urgently need to recapitalise their businesses. Halifax, Nationwide, Britannia, Skipton and Cheltenham & Gloucester have all raised their rates recently. So even if the Bank of England lowers interest rates, you can’t rely on the benefit being passed on to you.

What can you do to hedge or protect your position next year? One solution is to reserve a rate 6 months in advance. When you get a mortgage offer, the lender will often guarantee to lend to you at a particular interest rate and the offer can remain open for as long as 6 months. You have to pay a fee which might be 2½% of the loan, but balance that against the risk that if you leave it till 6 months time to renegotiate your mortgage, interest rates may have gone higher than ever making it impossible for you to afford the new mortgage rates. The beauty of this approach is that if offers you some protection if rates go up, but you don’t have to take it up. If everything changes in six months and there’s a better mortgage deal available at the time, you can take that instead. All you’ve lost is the fee. That may be a fair price to pay to secure yourself in an uncertain future.
It may be worth it if you are in negative equity, so you can’t sell or raise a mortgage elsewhere.

Some deals also come with a “drop lock” option which allows you to switch from a tracker deal to a fixed-rate deal without paying a penalty. The advantage of this  is that you can initially go on a tracker mortgage if you see interest rates dropping, but if they rise, you can switch to a fixed rate to avoid getting caught by a very high interest rate.