House prices and turnover both falling, says Land Registry

House prices in England and Wales slipped below the £160,000 mark, the Land Registry has reported.

The average house price now stands at £159,999, a 0.9% monthly fall and the largest monthly drop since February 2009.

The October figure was also down 3.2% compared with October 2010.

Even in London, house prices dropped, by 1.6% in October compared with September, to stand at £340,408. London house prices are now just 0.3% higher than a year ago.

Volumes of house sales have also decreased sharply.

In May to August 2010, there was an average of 60,970 sales per month.

In the same period this year – the last period for which transaction data is available – there were 57,177 sales on average per month, a drop of 6.2%.

By contrast, the new homes website Smartnewhomes yesterday reported that asking prices of new homes have bounced up to reach £222,620.

That is 0.6% higher than in September, and an astonishing 5% higher than in October last year.

News Source: http://www.introducertoday.co.uk

Bogus PPI claims to cost banks millions more

Banks are having to put more money aside to deal with bogus PPI mis-selling claims – purely because of the extra admin involved.

They are having to spend millions dealing with ‘vexatious’ claims from customers who never even bought a policy, or from people who have never even been customers.

Nationwide last week revealed that these ‘vexatious’ claims account for around 30% of all complaints, with the vast majority being submitted by claims management companies.

Nationwide said it is partly because of these invalid claims that it has increased its PPI provision of £19m for the year ending September 2010 by a further £15m for the first half of this year. But £10m will go towards the cost of processing claims rather than customer redress.

Other banks are reporting the same problem.

Santander, which has put aside £731m, said half of the PPI claims it receives are from claims management companies, of which a third are not valid. Up to 80% of claims from claims management firms are proving to be from people who have never had a PPI policy.

Lloyds has also confirmed that a number of claims are invalid, whilst Barclays says that some 20% of the claims it has had are not from its own customers. Royal Bank of Scotland says one in five claims are not genuine.

News Source:   http://www.introducertoday.co.uk

FSA warns against sales of 'death bonds'

The FSA has issued the strongest possible warning against selling US-traded life policy investments in this country – so-called death bonds.

The regulator says it will ban their sale to UK consumers.

‘Death bonds’, says the FSA, are high risk and toxic products.

They are known as ‘death bonds’ because investors are essentially betting on the life expectancy of US American citizens.

They put their money into a pooled investment or fund which buys up US life insurance policies at a reduced value from people who are seriously ill, in order to collect the full pay-out when they die.

But many insurance policy holders may have been given the wrong prognosis, or medical advances mean they will live longer.

If they do, then the investment for someone in the UK will not function as expected. As well as being financially dodgy, many view the investments as literally sick – very morally dubious.

Margaret Cole, FSA managing director, said: “Firms should not be selling these high-risk products to retail investors, and so our guidance reminds firms of the importance of assessing whether a product is suitable for a customer and whether promotional material makes risk warnings clear enough.

“Products such as TLPIs are not a simple problem for the FSA to address as many of them are based outside of the UK, and so are outside the FSA’s jurisdiction. There are also considerations under EU law that will affect what we can do.

“However, the FSA is engaging in discussions in Europe around the MiFID review, AIFM Directive and with other European supervisors to find a solution to give greater consumer protection against these products.

“For now, we want to make our message about these products clear – they are completely unsuitable for most UK retail investors.”

News Source: http://www.introducertoday.co.uk/