Amendments to the universal credit rules introduced this month could see many thousands forced to boost their income or find work to retain their benefit payments.

Current estimates indicate that around six million people in the UK are currently claiming universal credit, as the escalating living-cost crisis threatens millions with the looming risk of fuel poverty.

Within universal credit legislation, the administration earnings threshold (AET) means that claimants who earn nothing or have earnings below a specific threshold are automatically added to the intensive work search regime. Those concerned are required to attend regular face-to-face meetings for job search purposes and are placed under extensive pressure to apply for jobs.

By contrast, claimants who earn in excess of the AET threshold are bracketed in a “light-touch” category, where payments are received alongside their employment and there is little to no immediate pressure to seek higher-paying jobs.

On September 26, the current AET threshold of £355 per month will increase to £494 per month, almost £150 higher. Likewise, the AET for couples claiming together will increase from £567 to £782.

Early indications suggest that approximately 114,000 people will subsequently fall below this new AET threshold and will be subject to the same strict rules and regulations in relation to finding work. If these rules and regulations are not satisfied, AET payments may be withdrawn entirely.

Work and Pensions Secretary Thérèse Coffey was quoted by the Liverpool Echo as having said that the alterations to the regulations will “help claimants get quickly back into the world of work while helping ensure employers get the people they and the economy need.”

Elsewhere, a spokesperson from the DWP said that the AET rule was long overdue and needed an important update.

Since its introduction in 2013, the AET has not kept pace with the increases in the National Living Wage, with the result that the number of hours needed to work to earn the AET has fallen over time,” read an extract from the statement.

“The adjustment will bring the AET back to its original ‘parity’ with the National Living Wage.”

Claimants who are affected by the new AET threshold will be automatically transitioned to the more intensive work search regime. This means being required to attend mandatory work search reviews at a local job centre, which take place either on a weekly or monthly basis.

Evidence will need to be provided at such meetings that the claimant in question is actively looking for work and spending at least 35 hours a week engaged in work-related activities. However, those with caring responsibilities or health conditions will be subject to different rules.

The DWP has stated that it will be contacting those affected by the changes directly.

 

Relocating can be stressful at the best of times, but it is nonetheless an everyday part of life for the UK’s estimated 10,000 property guardians. Property guardianship is a popular, recognised, and heavily regulated concept in some other European countries, but it is uncommon in the United Kingdom.

But for those who are able to assume the role of property guardian, the potential benefits can be huge.

Property guardians pay property management companies a set fee to live in (and take basic care of) properties that would otherwise be empty buildings. This could be anything from a disused retail building to a vacant office complex to a historic listed building. Property guardians need to be flexible, as they can be asked to leave (and/or relocate to another property) at any time with just four weeks’ notice.

In return, property guardians get to live in these unused properties for an average of just £350 per month—significantly less than the cost of renting a single room in even a fairly modest property.

Health and safety regulations

In order for a vacant property to be let out to a guardian, it needs to be in a suitable state of repair and comply with all basic health and safety legislation. This means it must have appropriate cooking, washing, and sleeping facilities, along with reliable access to basic utilities, in a generally safe and secure environment.

The guardian is essentially an employee of the real estate management company, taking basic care of the building on their behalf. For the property management company, significant savings are made on the costs of formal property upkeep and hiring security firms or guards to watch over their properties.

Growing demand

Record-high monthly rents coupled with the escalating living-cost crisis have resulted in a major spike in demand for guardianship places, according to the Property Guardian Providers Association (PGPA).

It is estimated that there are currently around 10,000 property guardians in the UK, but the number is expected to swell to more than 50,000 by the end of this year. According to the PGPA, no less than 32,000 people submitted applications to become guardians over the past 12 months.

The PGPA has warned that the sector is unlikely to be able to meet growing demand due to general shortages of available inventory. In addition, increasingly tight regulations placed on properties are making it difficult for property management companies to hire guardians for some types of buildings and premises.

But while a lack of long-term stability and being forced to relocate regularly bring issues, most of those taking part in the scheme believe that the pros vastly outweigh the cons.

In addition, potential security concerns regarding these vacant properties are apparently unfounded, according to the chair of the PGPA.

“The security aspect that guardians provide is simply by being in occupation,” said Graham Sievers, pointing out that vacant buildings without guardians are far more likely to attract squatters and anti-social behaviour.

“The guardians themselves are not expected to be security officers or patrol the building.”

Mr Sievers also said that by no means is the guardianship scheme aimed exclusively at vulnerable people in desperate financial situations.

“We’ve had people who are approaching retirement—teachers, for example—turning to guardianship so that they can save up money to buy their ideal cottage,” he said.

Meanwhile, the Department for Levelling Up, Housing, and Communities released a statement suggesting that such schemes should be approached with due care and caution.

“We do not endorse or encourage property guardianship as a form of housing,” read the statement.

We recognise, however, that people have the right to make their own informed decisions about their housing choices, and property guardians and local councils should follow our extensive guidance on their rights and responsibilities.”

House sharing is typically associated with students and younger people looking to combine independence with affordable living. But as the living-cost crisis tightens its grip on UK households, more over-50s than ever before are setting their sights on shared accommodation.

The latest figures published by a flat-sharing website indicate an almost 240% increase in the number of 55- to 64-year-olds seeking shared housing over the past decade. The site also noted a 114% increase in shared accommodation interest in the 45-to-54 age group.

Most of those seeking shared accommodation are aged 25 to 34 years old, but the number of older adults showing a willingness to share accommodation with other renters paints a stark picture of the UK’s housing market.

Unsurprisingly, the communications director of the website in question told the BBC that astronomic monthly rents coupled with the cost-of-living crisis were the main factors motivating older adults to seek shared accommodation. Mr Hutchinson also said that more people than ever before were accepting the prospect of becoming lifetime renters, having been completely priced out of the housing market.

According to the latest figures from the Office for National Statistics, average rent prices have been increasing steadily and consistently for well over a year now. More people are spending greater proportions of their income on monthly rents than ever before, as landlords continue to increase their prices due to skyrocketing demand.

On average, monthly rent prices have increased by 3.2% over the past 12 months, taking the average monthly rent outside London to £1,126.

The pros and cons of shared accommodation

Surveys conducted by leading home-sharing sites and services suggest that most of those considering shared accommodation are doing so purely for financial purposes. Elsewhere, others have reached the conclusion that the financial benefits (i.e., savings) of house sharing outweigh the potential disadvantages.

Even so, those who are considering moving into shared accommodation at any age are advised to consider all pros and cons carefully.

For example, the main advantage of shared housing is comparatively low living costs. Your monthly rent payment is much lower, and you share the utility bills with your housemates.

In addition, you may be able to secure a place in a property that is otherwise out of your price bracket. This is particularly true when it comes to city centre accommodations and homes in desirable locations in general. By renting a space in a shared house, you could live somewhere that would otherwise be out of reach.

Some older adults moving into shared accommodations have also spoken of the potential social benefits. Making connections as an older adult is not always easy. Shared housing brings the benefit of ‘built-in’ friends. This can be particularly beneficial for those who feel lonely or insecure about living alone.

On the downside, there are no guarantees that you will get along with your new housemates. Their lifestyles and behaviours, in general, may clash with yours, making it difficult to live together harmoniously.

Likewise, conflicts over facilities and resources in shared housing are common. You may have become used to the freedom of having your own kitchen and bathroom, for example, only to now have to wait in line for your turn.

There is a lack of privacy and seclusion that comes with shared housing. Even if you have your own private space within the house, you still technically live with several other people. Whether this is a good or bad thing is a matter of personal preference, but it can still be quite an adjustment to have lived independently beforehand.

With more customers taking their business online than ever before, major Banks are being forced to rethink their presence on the High Street. Following a raft of recent closures, Lloyds Banking Group has confirmed plans to permanently close a further 66 bank branches by the end of the year.

According to Lloyds, 19.1 million of its customers now use online banking, and around 15.6 million people manage their affairs via the bank’s mobile app. Foot traffic at the bank’s physical branches has been decreasing steadily for some time, resulting in the decision to close another 48 Lloyds sites and 18 Halifax branches over the coming months.

According to Lloyds, the bank has seen a 60% fall in overall branch visits by customers over the last five years, increasing to as much as 85% in some parts of the UK.

However, Lloyds was keen to emphasise the closures will not result in any voluntary or involuntary redundancies, and that all staff members affected will have the opportunity to transfer to different parts of the company.

Lloyds Banking Group will maintain a comparatively strong presence on the UK High Street, with 646 Lloyds Bank, 510 Halifax and 165 Bank of Scotland branches set to stay open for the time being.

Full List of Closures Confirmed by Lloyds

The full list of Lloyds Bank and Halifax locations set to close during the winter is as follows:

•   Lloyds, Bromyard
•   Lloyds, Chigwell
•   Lloyds, Catterick Garrison
•   Lloyds, Malvern Link
•   Lloyds, Redruth
•   Lloyds, Lutterworth
•   Lloyds, Palmers Green
•   Lloyds, Cheadle
•   Lloyds, Lytham St Annes
•   Lloyds, New Ollerton
•   Lloyds, Paternoster Sq, London
•   Lloyds, Earls Court Rd, London
•   Lloyds, Leadenhall St, London
•   Lloyds, Axminster
•   Lloyds, Barton upon Humber
•   Lloyds, Belper
•   Lloyds, Intake, Sheffield
•   Lloyds, The Moor, Sheffield
•   Lloyds, Tilehurst, Reading
•   Lloyds, New Romney
•   Lloyds, Edgbaston, Birmingham
•   Lloyds, Wooley Castle, Birmingham
•   Lloyds, Billericay
•   Lloyds, Immingham
•   Lloyds, Tonbridge
•   Lloyds, Edgware Rd, Paddington, London
•   Lloyds, Notting Hill Gate, London
•   Lloyds, Sandbach
•   Lloyds, West Wickham
•   Lloyds, Darlaston
•   Lloyds, Purley
•   Lloyds, Aldridge
•   Lloyds, Rothbury
•   Lloyds, Wootton Bassett
•   Lloyds, Guisborough
•   Lloyds, Cheddar
•   Lloyds, Cinderford
•   Lloyds, Cleo bury Mortimer
•   Lloyds, Holyhead
•   Lloyds, Wallingford
•   Lloyds, Bishop’s Waltham
•   Lloyds, Helston
•   Lloyds, Looe
•   Lloyds, Lewthwaite
•   Lloyds, Welshpool
•   Lloyds, Pwllheli
•   Lloyds, Caldicot
•   Lloyds, Llandrindod Wells

Halifax

•   Halifax, High Holborn, London
•   Halifax, Hitchin
•   Halifax, Ripon
•   Halifax, Stowmarket
•   Halifax, Newry
•   Halifax, Whitchurch
•   Halifax, Dorking
•   Halifax, Mitcham
•   Halifax, Retford
•   Halifax, Tiverton
•   Halifax, Tottenham Ct Rd, London
•   Halifax, Windsor
•   Halifax, Stroud
•   Halifax, Ruislip
•   Halifax, Birmingham
•   Halifax, Rawtenstall
•   Halifax, Coleraine
•   Halifax, Warminster

Commenting on the closures, the director of consumer relationships at Lloyds Banking Group, Russell Galley, said that the decision reflected the shifting trends and priorities of the bank’s UK customers.

“Our customers have more choice than ever in how they bank with us. As our customers do more online, visits to some branches have fallen by as much as 85% over the last five years,” said Galley.

“Alongside our digital, online and telephone services, we’ll continue to invest in our branches, but they need to be in the right places, where they’re well-used.”

Elsewhere, Lloyds Banking Group has faced heavy criticism from trade unions and consumer groups, which have accused the company of both putting jobs or risk and leaving some communities with no convenient access to banking.

In total, more than 5,000 bank and building society branches have closed across the UK since 2015, according to trade union Unite.

Before placing your home on the market, it makes sense to perform a little profit-oriented housekeeping. Ask any real estate expert, and they will tell you how it is often the smaller details that add up to the biggest differences price-wise.

But of all the home improvements you can conduct before selling your home, which have the most positive effects on market values?

According to those who specialise in maximising properties’ market values, the following could make a significant contribution to your home’s value and curb appeal:

1. Painting and decorating

Superficial it may be, but a fresh coat of paint really can hide a world of sins. Always remember that those who view your home with the intention of making an offer want to see it as something like a blank canvas. Hence, a pristine coat of fresh paint (in a neutral colour) can be just the thing to help them do just that.

1. Basic repairs

The same can also be said for the equally superficial repairs that are technically not a big deal. Examples of this include stiff doors, squeaky floors, window rattles, cracked wood, chipped paintwork, broken lights, stained fabrics, and anything else that could technically take the shine off the room in question.

1. Front door, porch, and hallway enhancements

First impressions are everything, and most prospective homebuyers make up their minds almost immediately after entering a property for sale. Anything you can do to make that all-important first impression the right first impression is something you should be doing. Ensure your entrance ways send the right message about the rest of your home.

1. Declutter and clear out

Back with the blank canvas theme, getting as much excess clutter out of your home as possible is essential. If necessary, consider hiring a storage locker for the duration of your relocation, offloading everything that does not need to be there.

1. Kitchen and bathroom remodelling

Installing a new kitchen or bathroom (or simply updating your existing setup) could add anything from £5,000 to £25,000 to the total market value of your home. In both instances, the average return on a kitchen or bathroom upgrade when selling a home is around 65%.

1. Smart lighting and heating

With the living-cost crisis only set to get worse before it gets better, more prospective buyers than ever before are prioritising smart and efficient utilities. Smart lighting and heating, in particular, can be highly attractive to prospective homebuyers, constituting an affordable upgrade and adding as much as £10,000 to a home’s market value.

1. Outdoor living spaces

More people are spending more time at home than ever before, as hybrid working continues as the new norm. Private outdoor living spaces are particularly attractive to prospective homebuyers, which in many cases can be a deal-breaker. Research suggests that by presenting your home’s exteriors in the right way, it can increase the value of your home by more than £8,000.

1. Private parking

Building a garage or driveway may seem like a major undertaking, but doing so can nonetheless lead to a healthy return. On average, adding a single-car garage to a home can increase its total market value by as much as £25,000 in some parts of the country.

1. Loft conversions

The value added by a loft conversion will be determined by multiple factors, including the functionality of the new space and its size. In the case of a fully functional living space large enough to use as a bedroom or home office, a loft conversion can easily add £40,000 or more to a home’s market value.

1. Conservatories

Last up, a modest conservatory can be installed for as little as £5,000, yet it can make a significant contribution to a home’s asking price. Anything from £8,000 to more than £15,000, depending on the location of the property and the type of conservatory installed.

England’s escalating housing crisis shows no sign of abating anytime soon, as Homes England is once again short of meeting any of its housing delivery targets. The figures in the agency’s 2021/22 annual report and financial statements make for a disappointing reading, with just 26,953 out of a planned 34,349 affordable homes having been successfully built.

In total, Homes England fell 15% short of its aim to build 44,275 new homes this year, having successfully constructed 37,632.

Pointing the finger of blame squarely at labour shortages and material procurement issues, Homes England said unexpected discrepancies had increased home delivery times by around 20 weeks on average.

“Capacity issues in the planning system, nutrient neutrality challenges, and material and labour shortages with increased associated costs have caused delays to housing provisions, impacting the agency’s delivery against its KPIs,” commented Peter Denton, CEO at Homes England.

The agency also failed to meet its unlocked housing capacity target, unlocking 58,993 homes through infrastructure and land, 38% fewer than its goal of 94,863.

Homes England also said that the shortfall was attributed in part to several key infrastructure programmes reaching the end of the funding deployment phase and moving to portfolio management.

“Our affordable homes programmes are a core contributor to our completions, and over the past year, partners have reported challenges in delivering completions,” read an extract of the report from Homes England.

“This has mainly been due to delays and access to labour supplies and materials. Schemes approaching completion were more directly impacted by labour and material shortages because it is at this stage where the need for resources is greatest.”

“Delays added c. 20 weeks to delivery times, reducing capacity to complete homes in the original timeframes.”

A brighter outlook ahead?

A brief summary of the targets set out by Homes England and the agency’s actual performance can be seen in the table below:

KPI	2021/22 actual	2021/22 Target	Difference	% away from hitting the target
Completions directly supported by Homes England	37,632	44,275	6,643	15.00
Completions directly supported by Homes England (additional to the market)	25,279	30,922	5,643	18.25
Affordable, completed homes supported by Homes England	26,953	34,349	7,396	21.53
Starts supported	38,562	48,810	10,248	21.00
Unlocked housing capacity	58,993	94,863	35,870	37.81

Source: Homes England annual report and financial statements

Despite the disappointing performance for 2021/22, Peter Denton reaffirmed the agency’s commitment to further expansion and enhanced regeneration going forward.

“This means we will not only deliver the homes this country needs, but we will also work with partners to revitalise run-down and derelict sites in order to bring confidence, pleasure, and pride back to our town centres,” he said.

“With a renewed focus on regeneration, a more place-based way of working will be central, bringing together all our tools and capabilities to support local leaders to deliver their vision for their towns, cities, and rural communities.”

“While boosting housing supply across England remains an important focus for the agency, our role is increasingly about more than making homes happen—it is about creating sustainable, thriving places that foster a sense of community and pride and can better connect people to employment opportunities and provide the amenities they need.”

The lack of inventory in the UK’s prohibitively expensive housing market shows no signs of abating soon. According to the most recent figures published by the Department for Levelling Up, Housing, and Communities (DLUHC), just 84,000 of the 109,900 applications for planning permission submitted in Q1 this year were granted.

This equates to an 87% success rate for planning permission applications submitted during this time—down 4% compared to Q1 2021. This may sound less than significant, but it comes at a time when the UK is in dire need of a major uptick in affordable home availability.

In addition, the total number of planning permission applications received for the quarter was down 12% compared to the previous quarter.

A total of 9,300 residential planning permission applications were granted in England in the first three months of the year, a 6% decrease compared to the same time last year. 1,900 commercial planning permission applications were granted. Down 2% from Q1 2021.

Affordable inventory is urgently required

The dire need for rapid acceleration in the housebuilding sector was highlighted by Paul Neal of Missing Element Mortgage Services, who emphasised the importance of focusing on the availability of homes for people who actually plan to live in them.

“Not stock that is snapped up by landlords or builders to make a fortune on. Reliable, affordable housing for everyday people,” he said.

“Sadly, it’s not coming at anywhere near the pace it needs to, and planning is often the issue.”

Speaking on behalf of London-based property developer New Place, managing director Joe Garner said that the DLUHC data provides a clear indication that nowhere near enough homes are being built in the right places.

“The planning system is an absolute mess, and political infighting from central government all the way down to local councils is perpetuating the housing crisis,” he said.

Garner’s sentiments were echoed by Jamie Lennox, director at Norwich-based mortgage broker Dimora Mortgages, who likewise said that the government is not even coming close to meeting its own house-building targets.

“Many developments get stuck in planning for years, and until there is a quicker process to get sites approved, the ambitious plans for a certain number of new homes won’t ever materialise,” he said.

Help to build push continues

Meanwhile, the government continues to push its Help to Build scheme as a potentially affordable alternative access point to the UK housing market.

Help to Build provides those looking to build their own homes with the opportunity to access a special mortgage of up to £600,000, which can be secured with a deposit of just 5% and offers the first five years interest-free. This 95% LTV mortgage will only be available through a selection of approved lenders, and the scheme is being managed by Homes England.

“Through the Help to Build scheme, we will help thousands more people onto the property ladder by giving them the opportunity to build homes that are perfectly tailored to their needs and in the communities they want to live in,” said Housing Minister Rt Hon Stuart Andrew.

“This innovative scheme will build on our work to break down the barriers to homeownership, as well as create new jobs, support the construction industry, and kickstart a self- and custom-build revolution.”

Open to movers and first-time buyers alike, Help to Buy combines low initial deposit requirements with five interest-free years, followed by a 1.75% APR in the sixth year and incremental annual increases thereafter.

“Self-build isn’t the preserve of the wealthy, and Help to Build makes it more practical and accessible than ever before for people to build their dream home,” said Andrew Craddock, Darlington Building Society chief executive.

“This scheme also opens up opportunities for first-time buyers. It is a fantastic example of the market moving with the times and people’s changing wants and needs.”

 

Invoice finance provides businesses with the opportunity to access money they are owed by their own customers in advance. In doing so, delays between issuing invoices and collecting payments can be shortened or eliminated entirely.

Where the business issues an invoice, the recipient may have anything from seven to 90 days to pay, sometimes even longer. During this time, the business must continue to make ends meet with its own on-hand capital reserves.

Effectively a financial ‘gap-filler’ for such scenarios, invoice finance allows the business to access its owed capital immediately.

How does invoice financing work?

Invoice finance can be beneficial for any business (or sole trader) for which significant gaps between raising invoices and receiving payments are the norm.

The facility is arranged by a specialist lender, who takes into account the company’s financial status and the professional background of the applicant. Pending invoices are then used to determine how much the business is owed, and the lender issues a loan to cover this outstanding amount.

Over the subsequent weeks or months, the business repays the loan as it collects payments from its customers.

“As the culture of late payment continues to rise here in the UK, the threat that this poses to businesses also grows. Our recent survey results highlight just how vital invoice finance is to businesses,” explained Phil Chesham, head of invoice finance at Time Finance.

“Of the business owners surveyed, 67% reported that an invoice finance facility helps them to pay suppliers, HMRC, employees, and other financial commitments on time. 50% told Time Finance that it helps to manage late payments from customers, and over one-third said it helps them to better combat the current economic challenges such as rising costs and inflation.”

“With late payment debt as high as £200,000 for one in five UK SMEs, invoice finance solutions are as vital as ever, and with the addition of our credit control service here at Time Finance, we can really take the strain away from chasing payments and protect our clients’ customer relationships.”

What Are the Advantages of Invoice Finance?

The potential benefits and cost-effectiveness of invoice finance will always vary significantly from one business to the next.

For those who stand to benefit from an invoice finance agreement, the main advantages of the facility are as follows:

• Access to Quick Cash: Businesses with plenty of liquid capital always enjoy a competitive advantage over those with limited cash reserves. With invoice finance, the business gains access to the money it is owed right after its invoices are issued.
• No Assets at Risk: Invoice finance is issued in the form of a specialist unsecured loan, for which the invoices themselves serve as a form of collateral for the facility. This means no physical assets need to be put on the line and subsequently put at risk.
• Missed or Late Payments: It can also be a useful facility for avoiding (or minimising) the consequences associated with missed or late invoice payments. Where customers pay late, the business can still access the money it is owed in a timely manner.
• Reputation Protection: Most businesses rely on their customers’ payments to meet their own payment obligations. Invoice financing can make it much easier for businesses to keep their own commitments, protecting both their reputation and their credit status.

What are the disadvantages of invoice finance?

Invoice finance is not suitable for all businesses, and there are downsides to such agreements that must be considered. The most important examples are as follows:

• Restricted to Business Customers: The only invoices that can be paid early as part of an invoice finance deal are those issued to other businesses. Invoices issued to the public cannot be claimed early on invoice finance.

• Potential Relationship Strains: With some types of invoice financing (invoice factoring), the lender subsequently takes charge of chasing up the borrower’s customers for payment. Depending on how this is handled, it could result in frayed relationships between the business and its customers.

• Long-Term Costs: Invoice finance can prove a highly cost-effective and beneficial solution, but it is never offered free of charge. Irrespective of the terms, conditions, and duration of the agreement, it will always result in additional costs for the business.

All the above pros and cons will be discussed in full during your initial consultation, during which your broker will help you determine your suitability and eligibility for invoice finance.

Invoice Finance in Practice

To illustrate how invoice finance works in practice, consider the following example scenario:

• A small business issues an invoice for £5,000 to a customer with a 30-day payment deadline.
• The business would like to get this money back as quickly as possible in order to invest it in a new project.
• An invoice finance agreement is reached for 85% of the value of the invoice, with total borrowing costs of 3%.
• The business receives a payment of £4,250 from the lender, i.e., 85% of the value of the invoice raised.
• When the £5,000 invoice is paid, the full £5,000 is transferred directly into the account of the lender.
• The borrowing costs (£150) are subtracted from the remaining value of the invoice (£750), and the remaining £600 is transferred back to the business.

All invoice finance contracts are bespoke agreements tailored to meet the exact requirements of the business in question. In most instances, the logistics of invoice finance are fairly similar and surprisingly straightforward.

For more information on any of the above or to discuss the potential benefits of invoice finance in more detail, call anytime for an obligation-free consultation.