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Across the UK, houses are selling at an average of nine percent below the asking price with sellers in some regions being forced to accept as much as 12.5 percent discount off their advertised price, says RICS research.

As economic fundamentals continue to worsen, the gap between selling and asking prices is widening. In the North vendors are accepting the lowest offers - averaging 12.5 percent below the marketed price. Vendors in the North West, East Midlands, West Midlands and Wales are accepting offers averaging approximately 10 percent below but in London the figure stands at 8.5 percent. London has remained firmer than most as its diverse economy and large job market offers sellers more room for optimism. Interestingly, Scotland has yet to be affected (where the gap is only 2.4 percent) but price falls in this region have lagged significantly behind the rest of the UK and it is likely that the gap will widen in the coming months.

In the North West, the majority of vendors accepted lower asking prices with 82 percent of Chartered Surveyors reporting that the gap had widened while in the West Midlands 75 percent reported a widening gap. More surprisingly the gap did not appear to widen in London in August with 67 percent of Chartered Surveyors reporting no change.

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The Treasury says it will be business as usual for B&B savers and borrowers
Mortgage lender Bradford & Bingley (B&B) is to be nationalised, the government has confirmed.

Under the arrangement, the government will take control of the bank’s £50bn in mortgages and loans. Shares in the company have been suspended.

B&B’s £20bn savings business and branch network will be bought by rival Abbey, which is in turn owned by Spanish banking group Santander.

B&B is the latest bank to fall victim to the crisis in the financial sector.

B&B is the second UK bank to be nationalised since the start of the global credit turmoil, following Northern Rock’s move into state ownership in February this year.

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It is being reported that HSBC has cut 1,100 jobs in its global banking and markets division.

The reductions in the division’s back-office operations amount to about 4% of HSBC’s wholesale banking workforce.

The move follows yesterday’s news that Bradford & Bingley has shut a mortgage processing centre and cut its sales team that deals with mortgage brokers, not to mention its branch-based advisers.

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The Property Investment Department at Attwells Solicitors has developed a package of sandwich lease documents to enable investors to secure these types of deals and to complete them quickly.

Simply explained, the scheme would be set up as follows:

• An investor secures an option over the property at a below market value price. The option is exercisable by the investor over an agreed period of time
• The investor manages the tenant on a day to day basis and makes the necessary payments to the mortgage companies each month. The seller has no involvement with the property throughout the option period
• The tenant at the property pays a higher rent each month to the investor and some of that increased rent is paid into a deposit account. This accrues over the period of time the option is in force
• At the end of the option period, and depending on the market conditions at the time, the investor can exercise the option and purchase the property from the seller
• In turn, the tenant raises a mortgage and purchases the property from the investor at full market value. The accrued deposit is returned to the tenant and is used as the deposit to purchase the property

If you are interested in this documentation or similar types of transactions, please email invest@attwells.com

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As of next month, extensions of up to two storeys will be permitted as long as they extend no more than 10ft from the back of an existing property — enough for a small kitchen or spare bedroom.

Loft conversions will also be allowed without planning consent, as long as they extend no more than 20cm (about 8in) from the eaves of a property. They must also be no more than 50 cubic metres in size — roughly the equivalent of a room 18ft by 12ft. In conservation areas, loft conversions will still be restricted but ­single-storey rear extensions will be permitted.

The rules will remove as many as 80,000 house­holders a year from the planning system. About a quarter of all home development projects that currently require planning permission will be able to go ahead without formal authorisation from councils.

Ministers said the relaxation of the rules would make it easier for those who were struggling to move house because of the credit crisis to extend their homes instead.

However, there will be new restrictions on home owners who want to pave their front gardens. In order to cut down on the volume of water flowing off driveways into drains, home owners will need planning permission if they want to lay more than five square metres of asphalt or other impermeable materials.

Paving in two strips to act as “wheel tracks” for parking will effectively escape the restrictions, as will driveways using water-permeable surfaces.

Domestic planning applications have more than doubled in the past decade to 330,000 last year. They can cost thousands of pounds and leave home owners mired in red tape for months, even though 90 per cent of applications are eventually approved.

By extending the “Permitted Development” regime, ministers aim to prevent unnecessary applications for relatively minor alterations.

As long as building projects fall within the new limits, neighbours will not be able to object. Government officials say the new restrictions have been set to ensure that no “obtrusive” developments will escape the planning system.

Local councils will have discretion to vary the rules, meaning that people in ­heavily-­developed areas may not get as much freedom to develop even under the new rules.

Building regulations will remain in place, meaning that householders will still have to demonstrate that alterations are constructed to health and safety standards.

The Royal Institution of Chartered Surveyors also supported the scheme but warned that it could increase tensions between neighbours.

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Jeremy Tigue, Head of Global Equities at F&C Investments, gives his views on the bailout of Fannie Mae and Freddie Mac

“Monday has seen world markets rally as the US Government announced moves to bail out Freddie Mac and Fannie Mae - the quasi-private institutions responsible for financing the US mortgage market. Together Freddie Mac and Fannie Mae finance or guarantee nearly half of all outstanding US mortgage debt.

The move is the third US Government intervention in the ongoing credit crisis following the collapse of Bear Sterns in March and then initial efforts to sort Freddie Mac and Fannie Mae in July of this year. The latest move however, is by far the most significant and could, in my view, signal a real turning point - much like the bail-out of the failing Long-Term Capital Management hedge fund did in 1998.

While the first two moves saw markets bounce in a knee-jerk reaction only to fall back again, this time I believe the change is more fundamental.

To put the deal into some sort of context it is over 25 times the size of the UK government’s rescue of Northern Rock and probably the largest financial bail-out since 1945. It also means that the US Government now ‘owns’ around 50% of US mortgages - an amazing statistic in the land of free enterprise. The scale of the rescue means it removes a huge amount of systemic risk from the global financial system. It also provides support to the ailing US housing market by ensuring mortgages will still be available, albeit at more expensive levels than in the past.

Whilst the move is undoubtedly good news, the US economy looks set to remain fragile in the foreseeable future and companies will continue to find the environment a challenging one.

From here on attention and pressure is also likely to focus on other countries whose housing markets are behind the US, including the UK. Indeed, at the weekend HBOS’s CEO said that he saw little prospect of any recovery until 2010, and indicated that the UK housing market could get worse from here. Irrespective of any potential moves by governments in the UK, Spain, Ireland or elsewhere we believe that, on balance, the US government intervention will prove to be a real turning point. Our view is supported by the fact that last week UK blue chips were yielding more than 10 year gilts, something which over the last 50 years this has proven to be a good buying signal.”

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The Monetary Policy Committe (MPC) has announced that the base rate will remain unchanged at 5%.

Despite the prospect of recession and the need to give the economy a boost the MPC has, as widely expected, left the base rate unchanged. Presumably this is to fulfil its remit of keeping inflation at or below 2% rather than looking at the economy as a whole.

However there is now a feeling generally that with a potentially prolonged recession looming, that interest rate policy will be eased, and rates should start heading downwards before the end of this year. Indeed the recent OECD forecasts showed inflationary pressures easing, which would give the MPC scope to cut rates without going outside its current remit.

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Hazel Blears has announced this morning that £300 million will be made available to help people facing repossession

The state will use £200 million to pay off mortgage arrears of “decent” families who have fallen into mortgage arrears and will allocate £100 million to pay mortgage interest. Despite initial public reaction which seems to be that people who have bought properties should have known the risks they were taking and should not get government support when they get into trouble, Hazel Blears believes that it is more cost effective to pursue this policy rather than see people thrown out of their homes.

Particularly upset are potential first time buyers who had previously been priced out of the market, and are now watching on as their taxes are used to subsidise homeowners.

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Loans of up to 30% of a homes value is just one of a raft of measures that are to be formally announced today. Under the scheme loans will be made for a period of up to five years, to families with an income of up to £60,000, after which the loan will have to be repaid and a “fee” will be payable, the level of which is currently unclear. This will be a joint inintiative between the state and large property developers and will be known as Homebuy Direct.

The Department for Communities and Local Government saidt that “not only will this help first-time buyers, but it will also support the industry by identifying buyers for their new homes.” They added that ” this will help the housebuilding industry weather difficult conditions, so that, when the market recovers, they are ready to expand and get back on with building the new homes the country needs for the long term”