Whoops. We meant to say: Dividends Will Be Paid!
A follow up to our previous post, the Government has moved to ’clarify’ it’s position after yesterday’s fallout over the bail-out. Whereas on Monday, the Treasury announced Dividends would not be paid out to shareholders until Government funds were re-paid…. This is now no longer the case:
UK Government To Clarify Bank Dividend Plan-BBC Peston - CNN Money
Lloyds TSB shares jump on dividend ban misunderstanding - Telegraph.co.uk
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British Bank Bail Out at Tax Payers Expense?!
Unless you spent your weekend under a rock, you would have heard about our Government’s rescue plan to our banks.
As I sat down this afternoon to disect the issue, I first read through my bookmarks and came across this little doozy from the Money Hospital. They do a great job of breaking down the plan and explaining, in laymen’s terms, what it means UK taxpayers. Here are a few of the highlights but I recommend giving them a read as well:
- Banks can borrow from the Government to increase their capital by £25 billion
- £200 billion will be available in short term loans from Bank of England
- Banks will have to sign up to an FSA agreement on executive pay and dividends
- Royal Bank of Scotland, Barclays, HBOS, Lloyds TSB, and Nationwide will take part in the equity raising
- Banks will pay the price of; no more big bonuses, no dividends to shareholders, and a promise to keep lending money to small businesses and potential homeowners.
I know, all this funny money talk (Billions?) and promises by banks? It all sounds a bit sketchy…
What do you think?
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Interest Rate Cuts - Everybody’s doin’ it…
If they all jumped off a bridge….
The Bank of England, along with 5 other Central banks dropped rates today in an unprecedented move aimed at stablising the faltering global economy. This decision in the UK was not expected until tomorrow, so the .5% drop came as a surprise. The Bank of England rate now sits at 4.5%.
Get more details here:
Central Banks Cut Rates - bbc.co.uk
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Silver Lining - Abbey Lowering Rates?
Abbey Mortgage Rates
Just when we thought all was lost…
Well, I’m being a little dramatic, but there was good news in the mortgage industry today when Abbey announced it will be reducing it’s rates and booking fees on it’s five year fixed rate mortgage package from tomorrow. Granted five years is a long time to be tied into today’s typical interest rates, but there is still a very real risk that rates could go up before they come down.
Regardless, it’s encouraging to see lenders aren’t afraid to move with the times and continue to offer customers viable mortgage options.
Abbey has also lowered rates on it’s two and three year fixed mortgage deals.
Read more at Mortgage Strategy
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Falling UK House Prices – Startling Facts
I know, what you’re thinking… more bad news. One thing we can always promise here at Best Quote Mortgages, we will never sugar coat anything. We may try to see the lighter side, but we will not lie to you. So, here’s the dirt on current UK house pricing trends:
- Prices have fallen for 11 straight months, making October, if the trend continues, one year of declining prices
- In September 2008, prices slipped another 1.7%
- September 2007 saw a 9% growth in purchase price
- 12.4% is the highest recorded drop in property value
- The average cost today of a UK property is £161,800
An article written by Simon Duke over at thisismoney.co.uk, quotes Nationwide’s chief economist Fionnuala Earley: “House prices have now fallen for 11 consecutive months, but the monthly rate of fall has been almost unchanged in the last three months”. This sounds positive.
She goes on to say: “The less volatile three-month-on-three-month series has also barely changed for the last three months, after accelerating in the first half of the year,” which suggests a calming down of the rapid decline in house pricing we have been experiencing in the UK.
Are we grasping at straws here in an effort to find any silver lining or is this a legitimate sign we’ve turned a corner.
What do you think?
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