Category Archives: Property Business

Short-term deflation is welcome relief

by Richard Butler-Creagh

With food prices dropping at the quickest rate in eight years in January, combined with further falls in the price of vehicle fuels, consumer price inflation is likely to move to a new record low in January, edging the UK economy closer to deflation, as such it looks increasingly unlikely the Bank of England will raise the base rate in 2015.  The Centre for Economics and Business Research said: “The headline rate of inflation, as measured by the Consumer Price Index, fell to just 0.5% in December.”  This is welcome news after the last couple of years of steep inflation, as high as 10% when taking into account the steep rise of fuel and food, according to some indicators.  Savers have been worse off with the inflation eroding their accounts and making their hard-earned worth less by the low interest rate.

There are other indicators that the slow-down is slowing down.  Banks are cautiously making funds more available to borrowers.    Barclays have shuffled into the lead enticing buyers wanting to fix for five years, with deals starting at 2.29%, a cut of 0.1% from a week ago.  First Direct has also shaved 0.2% off its five-year deal with a 2.59% fix until 2020.  As usual these are for lenders with large deposits, normally 30% or more, but it is all suggesting that the market is heading for an increase in activity.  When choosing a lender based on these 0.1 or 0.2% differences, remember to blends in the arrangement fees as they can alter the overall rate.

House prices still managed to increase last month with figures from Halifax showing that it jumped an incredible 2% taking the average to £193,130.  This could be due to the reform of stamp duty producing a temporary wave, a spokesman said.

Richard Butler-Creagh


At last planners approve more homes

The number of residential units for which planning has been approved across the UK has jumped by 41% over the last two years, according to data prepared for Knight Frank. Data released by the government shows that more than 48,000 homebuyers have used help to buy to get a leg up on the housing ladder. Some 30,000 have the used  the help to buy equity loan scheme, aimed solely at those buying new homes, while around 18,500 have used the mortgage guarantee, reports the Henley Standard, in an article entitled ‘Planners rush to fill demand for homes’.  Whatever your views on help to buy, and the government’s intervention in the housing market by this scheme, there is no doubt that it is having an impact on development volume.  Redrow is the latest housing builder to show that sale via help to buy have accounted for a notable proportion of transactions over the last year, in this case around 35%. The uncorking of latent demand for housing through help to buy has also helped boost confidence around lifting development volumes.  The latest planning data, which shows the number of private and social homes for which detailed planning as being approved in schemes of 10 units or more, highlights that developers are undertaking more work. This is reflected in record high construction activity, as reported by markit/ CIPS this week. It shows that around 190,000 units receive detailed planning in the year to July, up from 135,000 in the same period two years ago.  The planning  rules are no doubt also playing a part in the surge in planning applications, as under the relatively recently introduced national planning policy framework, the developments can be approved where a local authority cannot prove it has five years worth of housing supply This is the case for many local authorities there is still some way to go however Around 250,000 new homes are needed every year in the UK.  In the last financial year fewer than 140,000 were completed.

I think this is very encouraging as planning has always been the main stopping points for developments going ahead and hopefully this is the start of a complete overhaul of the system.


Richard Butler Creagh

Richard Butler-Creagh

Foreign currency lending: Scotland

In Scotland where values are still 22% below their peak, the impending referendum in September is undoubtedly having an impact on the property market.

While the outcome is unlikely to affect dramatically the intentions of existing Scottish residence, the uncertainty has had an impact on the number of buyers moving from London who, until the summer, were keen to take advantage of the value gap.  We would expect a decisive ‘no’ vote majority, to boost activity and consumer confidence in the housing market. In the event of a decisive yes vote, we would expect the current uncertainty to continue, with a further delay in the recovery.

That was a survey carried out by Savills. As a lender, we have stopped lending on Scottish properties until the outcome of the vote, this is just because of the uncertainty of the value of Scottish properties, and the currency that we would be repaid in.

When I am talking to property developers in Scotland I feel their frustration that this referendum is having on their business, they will think it’s going to be a no vote and find it difficult to believe that the independence vote will go through, but as a lender we have to be cautious and the uncertainty around the future of Scotland is just made it impossible to lend there at this moment in time.

Looking at the report carried out by Savills, I hope there is a decisive no vote, and that will give a much needed boost to the Scottish property market. If in the event of a yes vote, it would seem that there will be a long drawn-out process until the currency and the markets settle down and  and then we should see  the property market recover. There is still a question of how a person from outside what would then be a new independent Scotland, would we be able to buy a property and also who the lenders would be, would the English banks still be allowed to mortgage properties in what would be a foreign country?

Richard Butler-Creagh


Richard Butler Creagh

Right to Buy Demand Soars

The government’s Right to Buy scheme was launched by Margaret Thatcher in 1980 to encourage council tenants to buy their homes. I was researching how it has evolved especially in the light of the rising demand for housing stock. There was an article in the Daily Mail on 27th August and it raises some issues.

The article writes: The number of homes sold through the government’s Right to Buy scheme is up more than a third compared with last year. Figures from the Department for Communities and Local Government show 2845 houses were built through the scheme between April and June this year. That is 31% more than the 2171 bought in the same quarter last year. London was the most popular area, accounting for a third of right to buy purchases. Nationally, councils made a total of £210.8 million from the sales in the past year, with an average £74,000 paid for the property. It is an increase of more than 60% from the amount raised through sales in the same period last year. Since the launch of the Right to Buy, around 2 million properties were sold in the following three decades. In 2012, the scheme was reinvigorated to offer discounts of up to £75,000 on properties to encourage tenants to buy. The discount was increased in March 2013 to £77,000 and to £102,700 for London borough tenants. ‘Council house building starts are now at a 23 year high’, says Brandon Lewis, Housing and Planning Minister.

The thing I find difficult to understand about the Right to Buy scheme is that councils are having difficulty finding homes for new council tenants, and yet then they build new council houses then sell them off. I can see that if tenants are then taking over the responsibility of looking after their houses this then saves the council money as it has less housing stock to maintain. This is a viable solution as long as demand plateaus soon, easing up on the currently escalating demand for new build housing.

Richard Butler Creagh


Richard Butler-Creagh

Buy to Let

The buy to let business is a good long term investment if you are prepared to work at it. First you have to find the right location, this a very important part of the business, get it wrong and you will pay dearly.  When I started in this business I use to look in the areas I enjoy going to, it always makes life easier if when you have to go to the property for what ever reason its a place you like to hang out in so its not a chore. The next thing is to make sure its close to pubic transport, in london for instance it can make a lot of difference if it is zone 1 or 2 and so on. This a long term investment so you should look to the future and think what the next up and coming areas are, for instance when I started buying property I bought on the edge of a good area like west hampstead you can go closer to Kilburn which is not quite as good an address as West Hampstead but still popular and when it comes down to buying you get more for your money and as time moves on it becomes more expensive and the difference in rent from a property in the centre of West Hampstead and on the outskirts is not that much so can pay less when buying but get close to the same rent when renting. the next thing is kitting the place out, keep it simple and not cluttered make it so easy so that when the tenants move out it is easy just to freshen up and get ready for the next tenant. Rent, do your home because the tenants will, they will know exactly what the going rate is, if you are to high in price because you paid to much or spent to much on getting the property ready you will be waiting a long time to find a tenant.

Richard Butler-Creagh

Property bubble

One of the largest house-builders in Britain recently dismissed fears of a housing bubble as it reported booming demand for its new homes.  The House builders revenues jumped 21% last year after it sold nearly 12,000 homes and that is with sales 30% higher in the second half than the first. One of the rival companies also have record profits for the six months to the end of December so it seems that the industry is starting the new year in a really bullish mood.  all this came as figures from the mortgage lender, Halifax, showed house prices had dipped 0.6% in December but are still 7.5% higher than a year ago.

The whole of the housing market has had a remarkable recovery after many years of stagnation boosted by increased mortgage lending and assistance from the state-backed schemes such as Help to Buy.  Many people think that the revival has fuelled a housing bubble and this has caused the Bank of England to scale back the funding for lending scheme so it no longer applies to mortgages.

Some of the large house builders say they don’t think there is a bubble, they say they cover the whole of the country and think the pricing is stable across the board.

I think the main thing is that if wages increase inline with house prices there should not be a bubble, but as we know this is not the case so people buying property when interest rates are at record lows, it would not take much of an increase to make things very difficult for a lot of new home owners who are pushing themselves to all time highs in prices. One thing is for sure interest rates can only go one way at the moment, so as I have said in the past it is a good time to fix a good rate with your lender.

Richard Butler-Creagh

Richard Butler-Creagh: Property Developer and Consultant

Business life

Richard Butler-Creagh has been involved in the property business since 1985 when he discovered that he had a talent for finding good value properties in excellent areas but in various states of neglect being sold below market value.  He invested in the refurbishment of these properties after purchasing them and started building an impressive portfolio. He became an expert in real estate, locating the right property, financing it, renovating it and reselling it.  Financing is a critical element and from this experience it was clear to Richard that there was a gap in the market where credit providers were not meeting market needs.  Henley Finance Ltd, based in Henley on Thames is his new venture where he consults on all aspects of lending.

Racing for charity

Richard is a well-established businessman, property developer and property consultant.  He is also a passionate sportsman who competes in marathons, cycling and various other sporting events.  He recently cycled in tandem with his friend Brian Head in a charity race to raise funds and awareness for the Sue Ryder Hospice situated in Nettlebed.  Richard had never ridden a tandem bike before they started training together. Brian, who lost his sight after an emergency operation removing a pituitary gland tumour almost four years ago, is the father of Anthony Head who died at the age of 46 after a year-long battle with oesophageal cancer.  Anthony had finally lost his battle at the Sue Ryder Hospice.  He had owned his own successful software company employing more than 100 people across the UK.  Brian Head together with Richard Butler-Creagh rode in celebration of Anthony’s life.

Sporting achievements 

Richard is also an avid sailor, having sailed his yacht “Carpe Diem” across the Atlantic Ocean to Barbados in 2000.  He has also run the London marathon and in 2001 finished in 3 hours and 38 minutes.  In October 2013 he ran the Dublin Marathon and at the age of 50 beat his personal best he achieved 12 years earlier in 3 hours 25 minutes and 15 seconds, raising over £1,000 for Sue Ryder.   He is a member of the Royal Automobile Club and Pall Mall London.   Richard lives in Henley on Thames with his wife Charlotte whom he married in 2002, and his two children Ella and Blake.