Tag Archives: housing

Family law, finances and needs

Family law, finances and needs

Most people contemplating divorce will initially think about when to separate from each other, swiftly followed by a “How am I going to live?”.

As we all know one pot of money which can meet the needs of two people living together in one household is unlikely (in most circumstances) to stretch well to meet two households.

That’s where a good solicitor comes in. Whilst often thoughts are with divorce “I’m going to take everything” or “I’m going to have nothing” the law in fact provides for both parties (regardless of how the marriage ended – although there are some very rare exceptions).

Section 25 of the Matrimonial Causes Act 1973 is referred to by lawyers as “The Welfare Checklist” and this is something that the Court has to have regard to when looking at the financial settlement either agreed by a couple (or in the alternative ordered by the Court). This checklist requires all parties to consider the following:

  • Income and earning capacity of both parties;
  • Their needs and obligations (such as care of young children);
  • Standard of living;
  • Age of the parties and length of the marriage;
  • Health needs including disabilities;
  • Contributions by parties;
  • Conduct (in very rare circumstances);
  • Value lost by divorce (usually interests in pensions for example – ie. the loss of a future widow’s pension).

 

It may surprise people to know that the number of cases that go to a final hearing where the judge decides a settlement is in fact very few. The majority of cases will often settle, sometimes with help from a District Judge, with the aid of good and sensible solicitors and good preparation.

So, where do you go from here? The first thing to do is for the parties to exchange financial disclosure. This includes the value of any assets (such as property or savings and pensions), the amount of any debts (such as credit cards and loans). This is important as we need to know what there is before we can help advise how it can be divided between you.

We also advise clients to look at the housing market as to suitable properties for not just themselves but also their spouse. We look at all aspects of housing from, staying in the property and buying the spouse out of their interest, shared ownership (with a housing association), normal purchase of a home or renting.

The options are often limited by the amount of capital available to both parties and may be affected by whether there are children to rehouse with one party. This helps parties to be realistic about what should happen.

To be able to look at housing needs we also need to know your mortgage capacity and that of your spouse. The Court would consider a mortgage capacity to be an asset of sorts in that it assists the decisions on the division of capital from the marriage (i.e. if one spouse has a greater mortgage capacity then this may free up capital to help the other spouse with a lower mortgage capacity to be equally housed).

Pensions are generally shared between spouses on divorce (although where there is greater capital available it may be with agreement that there is an offsetting of pension interest by the payment of a greater share of capital).

As for income, a non-resident parent has a duty in law to pay maintenance for his children. This is based on a percentage of gross income. Parties can either reach agreement or if not then the question of maintenance will go through the Child Maintenance Service (formerly the CSA). For information on calculation of maintenance click here.

Depending in circumstances there may be a liability for maintenance to a spouse. This would be if there are young children or some disability or where there is a shortfall in their income versus their outgoings. If the spouse is in good health then a Court may limit the time for maintenance (for example to enable perhaps a spouse to retrain for employment) as the Courts are required under Section 25A of the Matrimonial Causes Act 1973 to achieve a clean break at the earliest possible time.

If any of the above affects you, we offer a free initial meeting when we can consider your matter and advise on the way forward. For an appointment please ring the Family Team on 01202 877400 (Ferndown Office) or 01305 470051 (Weymouth Office).

Housing Market in High Supply

It appears that the housing market is forgetting concerns triggered by Brexit, and people are deciding to just get on with it.

According to NAEA (National Association of Estate Agents), the number of homes for sale has hit a six-month high. They have reported that the average estate agency branch has 41 properties on its books.

The bad news for sellers is that buyers are bargaining hard, with reports of three-quarters of homes selling for less than the original asking price and sellers are having to be more realistic about the true value of their homes.

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So who does this effect? This increase in property for sale is great news for people who are thinking of buying property as they will have more Choice and possibly more bargaining power.

This will be very helpful for first-time buyers as the shortage of properties on the market, led to a significant mismatch between supply and demand, was one of the main factors pushing up prices.

The NAEA’s Figures show that the proportion of sales made to fist-time buyer has increased by 3% in August. This brings it to 28% of properties being bought by first time buyers, up from 20% the previous year.

The market slowed in the run up to the referendum due to uncertainty surrounding the outcome of the vote, with a low period following the rush to beat April’s stamp duty hike.

Its reported that two out of five estate agents expected the demand to increase further following the recent interest rate cut, with 25% of them expecting more first-time buyers to enter the market.

Mark Hayward, managing director, of the NAEA, said: “Following a few months of uncertainty in the market, it’s more than encouraging to see things moving in the right direction.”

The main points to take from this are;

The number of properties on the market have come to a six month high as the market seem to show signs of stabilising. The average estate agent has about 41 properties on their books, but three-quarters of properties are being sold for less than their original asking price.

If you are thinking about buying or selling, why not get one of our quick and easy conveyancing quotes. Just fill out one of our online forms and we send you an easy to read detailed quote. Click here to get a quote.

Housing Market in High Supply
How Will Brexit Affect Housing in the UK?

How Will Brexit Affect Housing in the UK?

Brexit and The Housing Market 

The short answer is nobody knows. The long answer, and it is long, is that Brexit will have several potential effects on the UK’s housing market and that there is no one guarantee on how this will affect you.

Short Term Fluctuations

Money & Brexit

In the short term Brexit is likely to cause a flattening of price growth and may even cause a slight decrease in average house prices. This reaction will be caused by uncertainty in the economy post Brexit, this uncertainty will remain until full details of the ‘exit’ plan and the UK’s international role outside the EU comes to light.

In a recent publication by the Royal Institute of Chartered Surveyors (RICS), as one of the first important surveys post the referendum result, it has found the in UK overall house price growth has moderated, but remained positive.

Additionally, RICS reports that the expected growth in house prices in the UK over the next 12 months has dropped from 54% in May to 0% in June and has gone negative in London and East Anglia.   The individual comments of surveyors from around the country provide a very varied set of opinions.

Many have noted slowdowns in the market and mostly blame the referendum for this, others have seen no changes in the markets and a few have actually had increasing demand.

Another comment which resurged many times was there is a large shortage of stock on the market at the moment which decreases the level of new instructions going out.  Other commentators have implied that sporting events (Euros and Wimbledon) cause the market to slow down and we are the end of the normal house purchasing season as we move into the summer holiday period.  In all this  means that it is too early to tell where the residential property market is heading over the next few months.

The Housing Crisis Is Not Solved

New homes and BrexitAn official parliament report estimated that around 232,000 and 300,000 new homes need to be built yearly to keep up with demand, this figure, is around two to three times higher than current supply.

Long term trends in the house price to income ratio show that in 2015 average house prices were around five times higher than average wages whereas in 1995 the ratio shows house prices were only two times higher than average wages.

Even with the 2008 housing market crash and the resulting global financial crisis house price growth has remained strong and quickly surpassed the pre-crisis levels, in the UK this growth in price can partly be attributed to the shortage of housing.

Another key element contributing to the housing shortage is population growth. Brexit despite what some may believe, will likely have little impact upon net migration, nor the natural birth rate. This obviously directly contributes to long term housing demand. With this in mind, Brexit is unlikely to affect the long term trend of price growth in housing.

Foreign Investors

Foreign Investors and BrexitWith the pound falling to a 31-year low against the dollar this may encourage foreign investors into the UK market. Although, foreign investors account for only a small portion of the residential property markets over the UK in general, London of course has a much higher ratio of foreign ownership.  Some hope that these investors may be able to provide buoyancy for a market heading for a decline.

A falling pound increases the buying power of these foreign investors encouraging them to enter the market looking for a cheap deal on a more than likely to increase in value, over the long term, asset. Furthermore, with the current infrastructure investment currently occurring in the North, specifically the HS2 cities like Manchester, have seen a surge in foreign property buyers.

First Time Buyers

First Time Buyers and BrexitA flat or declining market provides an excellent opportunity for first time buyers to get onto the property ladder. Pre-Brexit vote Vice President and Senior Analyst, Gaby Trinkaus, at Moody’s explained that first time buyers would benefit from Brexit via a potential curb in immigration, which would decrease housing and rent demand relieving some of the current pressure on the market. Moody’s claims that Brexit will be the positive news first buyers are hoping for because they have become largely priced out of the market, which is especially true for those looking in the South East and London markets. However, the negative for first time buyers is the fact that mortgage lenders are likely to reducing the loan to value ratios that they will loan in anticipation of volatile markets. This may require first time buyers to obtain higher levels of deposit values and/or have higher incomes than were previously required.


This article is intended for general information purposes only and  shall not be deemed to be, or constitute legal advice. Newnham &  Jordan Solicitors cannot accept  responsibility for  any loss as a result of acts or omissions taken in  respect of this  article or any external articles it may refer or link to.


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