Surge In First-Time Buyers 'To Fall Away'

A report suggests the number of first-time buyers rose 45% in the year to July but the surge in transactions will slow as property prices rise.

The latest First Time Buyer Monitor from LSL Property Services shows that plunging mortgage rates - partly a result of Government schemes to boost lending - helped 26,100 step on to the property ladder in the month.

That was a rise of more than 8,000 on the same month in 2011 and the best performance since November 2007, the report said.

The figure was released on the day the Halifax House Price Index registered a 0.4% increase month-on-month in August, 5.4% year-on-year in the three months to August, and suggested housing costs would continue to climb gradually during 2013.

The LSL report highlighted the improving affordability of first-time buyer mortgages as the Funding for Lending Scheme (FLS) meant banks were able to pass on cheaper credit to borrowers.

Other initiatives such as NewBuy and Help to Buy have been aimed at giving people with smaller deposits a leg-up.

But the study also pointed to strong house price growth over the period, which LSL warned threaten to stall the growth in buyers.

It said the average purchase price for a first-time buyer rose 8% in the last year to £146,726 in July, with deposits now representing a far greater proportion of the income of a first-time buyer.

LSL put the figure at equal to 83.1% of annual income, up 5.0% on July last year.

David Newnes, director of LSL Property Services, said: "There is simply not enough housing stock to match continued demand.

"If supply fails to keep pace with demand the housing market will become increasingly unsustainable.

"Prices will rise sharply, and future first-time buyers will be left in the lurch."

He added: "There is a desperate need for further cheap property in order for the run of success to continue."

Recent data has revealed a strong increase in the construction of properties as firms build on the improving economic outlook but analysts say the progress amounts to little in terms of supply against high demand.

00.02 | 0 komentar | Read More

Ford Boss Shows Off 'Communicating' Car

Ford's global boss has shown off a concept car that can 'communicate' with other vehicles while telling Sky News he is "very encouraged" by evidence of recovery in the European market.

In an interview in Berlin with Sky's Martin Stanford, Alan Mulally dismissed suggestions that industry sales - hit by the effects of the euro area's debt crisis - were rising again on the continent due to cheap government-supported credit.

He pointed to vehicle innovation and the stabilisation of the world economy: "The US is of course recovering from a very deep recession, but it's still growing at around 2%," Mr Mulally said.

He added that the end of the recession in the eurozone and the 6% to 7% growth rate in China provided a "tremendous opportunity" for further growth.

He continued: "We are very pleased with the way the industry has stabilised as far as auto motor sales both in the United States, which is growing, and also in Europe now.

Ford: S-Max concept car 'communicates' with other vehicles

"Worldwide, the [car] industry is growing at around 5% and Ford is probably in the best position we've ever been in.

"In Asia Pacific it's the fastest growing market in the world."

Mr Mulally was attending the IFA trade show to unveil new in-car technologies which he said would improve fuel efficiency and road safety.

The new S-Max concept was at the heart of his pitch.

The technology - developed by Ford and other manufacturers - would soon allow, Ford said, for cars of any make to communicate their presence to other vehicles using the road.

The interior of the S-Max shown off in Berlin

A driver's smartphone or other such device allowed, he said, improved connectivity through voice-activation, with even a driver's heart beat being monitored.

"Now is a very exciting time as the car becomes one of the connected devices on the internet," Mr Mulally said.

"As it becomes more knowledgeable, the driver has a lot more situational awareness.

"Our whole goal, by adding advanced technology, is to allow the driver to know more about the situation and to be an even better driver."

Mr Mulally was confident about the future of electric cars, despite sluggish industry sales.

"I think the electrification of our vehicles absolutely is the future," he said.

"It's all going to be dependent on the improvement that we make on the economics, and that really is going to be led by the cost, weight and efficiency of the battery."

00.02 | 0 komentar | Read More

M&S Clothing Suppliers Face 75-Day Pay Delay

By Mark Kleinman, City Editor

Marks & Spencer (M&S) is to force hundreds of its suppliers to wait almost 11 weeks for payment as the company's chief executive attempts to accelerate a turnaround of its clothing business.

M&S on Thursday informed almost 500 general merchandise suppliers - roughly 75 of which are based in the UK - that it was changing supplier terms to extend payment from 60 days to 75 days from the receipt of an invoice.

It said the move would bring the company "in line with industry standards".

In a letter from John Dixon, M&S's executive director for general merchandise, the retailer acknowledged that suppliers "may have some questions" and said they would come into effect from early next month.

The change is expected to generate tens of millions of pounds in annual cashflow benefits to M&S, which has seen like-for-like general merchandise sales decline for seven consecutive quarters.

Marc Bolland, the chief executive, is under pressure to reverse the decline although he has been handed some breathing space by a broadly positive industry response to M&S's crucial autumnwear collection.

The letter from Mr Dixon was accompanied by a separate note outlining the availability of a vendor financing scheme, through which HSBC and Royal Bank of Scotland provide immediate payments to suppliers in exchange for a substantial discount.

The changes to supplier payment terms may prove to be controversial given the lengths to which the company has gone to emphasise its ethical credentials and corporate responsibility.

M&S suppliers will now have to wait up to a month longer for payment than those of rivals such as Gap and Levi's, and 45 days longer than suppliers to Next.

However, Tesco, Zara and Monsoon take 90 days to deliver payment, while Debenhams takes 120 days, according to information circulated by M&S to its supplier base this week.

M&S has historically enjoyed particularly close relationships with its supplier base, but angered some two years ago by asking approximately 60 of its top clothing and homeware partners to contribute 1.25% of their turnover with M&S to the company's store refit and promotional programme.

In 2010, shortly after he took over from Sir Stuart Rose, Mr Bolland doubled the payment period from 30 to 60 days for freigh-on-board (FOB) suppliers, which refers to the arrangement under which a company takes ownership of stock as soon as it is loaded onto container ships.

Full-service vendor (FSV) suppliers typically have a deeper relationship with retailers, and these suppliers will see their payment delayed from five to seven weeks under the new terms.

An M&S spokeswoman said: "We are always looking at ways to ensure we are running our business efficiently and that it is well set up for the future. As part of this, we are extending our GM supplier payment terms to bring us in line with industry standards."

Mr Dixon's letter went on to add: "I'd like to take this opportunity to thank you for your ongoing support and commitment to M&S. We believe that parity and clarity in our terms of trade are important to all our suppliers and will help our businesses in the long term."

The supplier payment changes come as M&S continues to grapple with problems at a vast new distribution warehouse in Castle Donington, Leicestershire.

00.02 | 0 komentar | Read More

Tax Avoidance Crackdown Agreed By G20 Leaders

Steps to tackle international tax avoidance have been agreed by world leaders meeting in Russia.

While the G20 in St Petersburg was dominated by tensions over the Syria crisis, a deal was reached on new rules to make it harder to hide money in tax havens and force companies to pay tax in the countries where they make profits.

But it may take years to get the necessary treaties and laws into place, and campaigners argue the developing world should also be included in the new arrangements.

It comes against a backdrop of criticism of tax avoidance by multinationals such as Google, Amazon and Starbucks, that costs taxpayers billions in lost revenues.

Google, Amazon and Starbucks have faced criticism over tax avoidance

Countries including Ireland and Luxembourg have also come under fire for allowing big international companies to shift profits from larger neighbouring markets into tax havens.

Back in June, MPs demanded that Google be fully investigated over its "highly contrived" tax arrangements designed to avoid corporation tax on its multibillion-pound UK revenues.

Members of the House of Commons Public Accounts Committee branded claims by the internet giant that its UK sales activities take place in low-tax Ireland as "deeply unconvincing".

Google has insisted it complies with all the UK's tax rules, laid down by politicians.

Speaking at the G20 summit, Prime Minister David Cameron said making taxes more transparent is "a strong British priority".

00.02 | 0 komentar | Read More

The Sky News Business Round-Up And Look Ahead

Sky's Naomi Kerbel offers a round-up of what's coming up in the week's business news.

:: Monday September 9

Lloyds Banking Group begins rebranding the 630 branches that it must dispose of on Monday. Under European Commission rules it has been forced into the action as a condition of receiving a cash injection from the UK government in the wake of the 2008 financial crisis.

:: Tuesday September 10

Apple is expected to unveil the successor to the iPhone 5 on Tuesday. It is also expected to give the latest on its new mobile operating system the iOS 7 and reveal a low-cost new iPhone, possibly called the iPhone 5C.

:: Wednesday September 11

UK jobs numbers for the months from June to August are released. Last month's figures showed that unemployment fell by 4,000 in the three months to June, currently standing at 2.5 million, while the unemployment rate was 7.8%. Bank of England governor Mark Carney has said interest rates will not increase until the rate is below 7%.

:: Thursday September 12

Many companies are reporting on Thursday including first half results from retailers WM Morrisons, Next and John Lewis. Second quarter results from Home Retail Group which owns Argos and Homebase and third quarter numbers from Ocado.

:: Friday September 13

London Fashion Week Spring/Summer 2014 begins on Friday. The industry has been estimated to support nearly 1.5 million jobs and contribute around £40m pounds to the UK economy.

00.02 | 0 komentar | Read More

US Job Stats Drive Market Stimulus 'Frenzy'

Stock markets endured a rollercoaster after the release of US employment figures - a crucial indicator on when the Federal Reserve will ease its economic stimulus.

US employers added 169,000 jobs in August and much fewer in July than previously thought, according to the official data.

The slowdown in hiring was initially seen as complicating the Federal Reserve's decision this month on whether to start slowing its monthly $85bn of bond purchases to boost the economy.

Fears over the so-called "tapering" of asset purchases has gripped financial markets for months, reflecting the addiction to cheap credit in the world.

The Dow Jones industrial average rose on opening - alongside the FTSE 100 and other major European markets - but then fell back, closing with little change.

However the yield on the 10-year US Treasury note fell to 2.87% from 2.95% as investor expectations eased about the prospect of rising central bank interest rates.

The UK's 10-year debt yield - the interest rate the country pays to service its debts - also fell back from a two-year high to below 3%.

The US Labor Department said while the unemployment rate dropped to 7.3% in August, the lowest in nearly five years, it fell because more Americans stopped looking for work and were no longer counted as unemployed.

The proportion of Americans working or looking for work fell to its lowest level in 35 years.

July's job gains were just 104,000, the fewest in more than a year and down from the previous estimate of 162,000.

Employers have added an average of 148,000 jobs in the past three months, well below the 12-month average of 184,000.

ETX Capita' market strategist Ishaq Siddiqi said: "It's unwise to say tapering is off the cards in September, but it definitely has given the Fed and the market food for thought."

Meanwhile, US oil prices closed at a two-year high of $110.53 a barrel amid fears of escalating tensions in the Middle East and hope for continued stimulus from the Fed.

00.02 | 0 komentar | Read More

Denis O'Brien: Telecoms Tycoon Avoids Tax Bill

One of Ireland's richest men, billionaire telecoms and media tycoon Denis O'Brien, has avoided a 57m euros (£47m) tax bill over a lucrative share trade.

A long-runnning legal battle has ended with a judge ruling that the businessman was living in Portugal when he sold a multi-million holding in the phone company Esat Digifone in 2000.

The High Court in Dublin found that Mr O'Brien's home was in the Algarve not Ireland, and upholds a decision not to hit him with the tax bill.

The inspector of taxes in the Irish Republic, John Quigley, had challenged the original ruling in a bid to force an invoice for capital gains tax.

The bill had been disputed after Mr O'Brien bought a mansion in one of the most exclusive parts of Dublin, Raglan Road, Ballsbridge, in February 2000, around the time he sold the shares.

The deal saw the media mogul sell a holding in Esat to BT for 285m euros (£235m) and the taxman believed it should have netted 57m euros for the Irish state. Mr O'Brien was not in court and later declined to comment on the ruling.

The allegation was that a company called Parteney Limited, which was controlled by Mr O'Brien, had bought Raglan Road - a seven bedroom, detached house - in 2000 and that made him liable for the tax bill.

Judge Mary Laffoy, who heard the case, said the company was a separate and distinct legal entity from Mr O'Brien.

She ruled that the Dublin mansion was not a permanent home at the time of the share sale.

The O'Briens have argued that the Dublin mansion was uninhabitable when it was bought, a claim disputed by the people they bought it from, Peter and Letitia White.

Mr O'Brien moved to his house in Quinta de Lago, Almanscil, Portugal, in February 2000 after it had been built two years earlier and did not move into Raglan Road until 2003.

Mr O'Brien founded the Communicorp Group which has radio stations in five countries and he also owns mobile phone company Digicel, one of the dominant players in the Caribbean market.

00.02 | 0 komentar | Read More

Royal Mail To Pledge City Dividend Bonanza

By Mark Kleinman, City Editor

Royal Mail will pledge to pay hundreds of millions of pounds in dividends to City shareholders in an attempt to win private sector support for its £3bn privatisation, Sky News has learnt.

The company will make the promise as part of a Government statement announcing its intention to float the centuries-old postal operator on the London Stock Exchange, which is expected to be made towards the end of next week.

Sources close to the planned listing of Royal Mail said on Friday that the company was likely to commit to a specific shareholder payout for the current financial year, as well as a general intention to distribute up to about 50% of its profits in the form of dividends in subsequent years.

A valuation of £2.5bn - £3bn would see employees' stake worth up to £300m

The details are still being finalised and could yet change ahead of an announcement, one insider said.

Royal Mail's board is understood to have backed the dividend pledge in principle and is expected to meet next Wednesday to agree further details relating to the privatisation.

The dividend pledge is designed to reassure major City institutions about the attractiveness of Royal Mail as an investment proposition at a time when the threat of industrial action has again reared its head.

Postal operators in other European markets tend to pay out at least 40% of their earnings in dividends although Royal Mail would be expected to retain a large chunk of its future profits as it continues to invest in the modernisation of the company.

The share giveaway to staff will encompass 10% of Royal Mail's equity

"There will be an explicit and robust statement on the company's dividend policy, as you would expect," said a person close to Royal Mail.

However, the commitment on dividend payouts may also ignite further hostility from unions which have criticised the sell-off plans and accused ministers of transferring Royal Mail's economic value to the private sector while having nationalised its historic pension liabilities.

The Communication Workers Union (CWU) is preparing to hold a vote on national strikes at Royal Mail, saying it believed industrial action was "inevitable" without compromise from the company on issues including pay, jobs, pensions and the impact of any sell-off.

The Communication Workers Union is preparing to vote on national strikes

The union has been lobbying for a 10-year pay and conditions offer that would be underwritten by the Government.

The result of the ballot will be revealed in early October and the first strike could be held on October 10 if there is a vote in favour of industrial action.

A lack of progress settling the row could potentially lead to a dispute spilling into the festive season, Royal Mail's most profitable and crucial trading period.

The conflict has escalated despite a commitment made in July by Vince Cable, the Business Secretary, to hand 150,000 Royal Mail employees free shares in the company likely to be worth roughly £2,000 per worker.

As a further sweetener, staff will be guaranteed a proportion of the retail element of the initial public offering (IPO).

Strikes could be held in October if employees vote for industrial action

The share giveaway to staff will encompass 10% of Royal Mail's equity, in accordance with the Postal Services Act that paved the way for the sell-off of the company two years ago.

At an overall valuation of between £2.5bn and £3bn, that would value the employees' stake at up to £300m.

Members of the public will also be able to buy shares in Royal Mail through intermediaries, a website and in Post Office branches.

Royal Mail and the Department for Business, Innovation and Skills both declined to comment, although one source said an announcement about the flotation could yet be delayed depending on external factors.

The Government has vowed that the threat of a strike will not deter it from selling shares during the current financial year.

00.02 | 0 komentar | Read More

Snowden: NSA And GCHQ Crack Encryption Codes

US and British intelligence agencies have unlocked much of the online encryption that protects the privacy of internet users' personal data, online transactions and emails.

Many internet users assume that their online information, including medical records and bank details, is safe from snoopers, but fresh documents released by US whistleblower Edward Snowden appear to show otherwise.

Classified briefings between the National Security Agency and its UK counterpart GCHQ, obtained by The Guardian, show the agencies celebrating their success at "defeating network security and privacy".

A 2010 GCHQ document states: "For the past decade, NSA has lead an aggressive, multi-pronged effort to break widely used internet encryption technologies.

"Vast amounts of encrypted internet data which have up till now been discarded are now exploitable."

Whistleblower Edward Snowden handed the documents to the Guardian

The documents reveal various covert methods have been used to break down internet security, including an NSA programme, costing $250m (£160m) a year, which works with technology companies and internet service providers to insert weaknesses into their product designs.

Supercomputers have also been used to break encryption with "brute force" and in some cases companies say they were forced by the government to hand over their master encryption keys or build in a back door.

For at least three years, one document says, GCHQ has been working to develop ways into protected traffic on the "big four" service providers, named as Hotmail, Google, Yahoo and Facebook.

By 2012, GCHQ had developed "new access opportunities" into Google's systems, according to the document, which Google has denied.

Through these covert partnerships, the agencies have inserted secret vulnerabilities - known as backdoors or trapdoors - into commercial encryption software.

The agencies defend code-breaking, saying it is necessary to counter terrorism and gather foreign intelligence.

But security experts say the internet is being undermined as "cryptography forms the basis of trust online".

GCHQ and the NSA says code-breaking is necessary to prevent terrorism

Bruce Schneier, an encryption specialist at Harvard's Berkman Center for Internet and Society, told The Guardian: "By deliberately undermining online security in a short-sighted effort to eavesdrop, the NSA is undermining the very fabric of the internet."

The documents are among more than 50,000 shared by The Guardian with The New York Times and ProPublica, a non-profit news organisation.

The full extent of the NSA's decoding capabilities is known only to a limited group of top analysts from the NSA and its counterparts in Britain, Canada, Australia and New Zealand.

Only they are cleared for the Bullrun encryption-cracking programme, the successor to one called Manassas - both names of an American Civil War battle.

A parallel GCHQ counter-encryption programme is called Edgehill, named for the first battle of the English Civil War of the 17th century.

00.02 | 0 komentar | Read More

Osborne Ready To Press Button On Lloyds Sale

By Mark Kleinman, City Editor

George Osborne, the Chancellor, is considering selling part of the Government's stake in Lloyds Banking Group as soon as next week amid rising expectations in the City of a multi-billion pound share placing.

People close to the situation say that the Treasury, Lloyds and UK Financial Investments (UKFI), which manages the taxpayer's stakes in the UK's bailed-out banks, are discussing the prospect of a share sale that could take place within days.

Reports this week that a disposal of part of the Treasury's holding would almost certainly be delayed by concerns over the crisis in Syria were dismissed by Treasury insiders.

They acknowledged, however, that broader market risks, which also include the US Federal Reserve's forthcoming decision about whether to slow the pace of monetary stimulus, remained an "obvious factor in a decision".

"The reality is that a final decision about the timing of a sale hasn't been made yet but selling next week is a definite option," said one.

Sky News understands that:

:: JP Morgan, the investment bank advising UKFI on its privatisation strategy, has told the Treasury agency that a profitable sale for the taxpayer would be possible within days based on its assessment of the appetite for Lloyds shares among major institutional investors.

:: A number of major City shareholders have this week encouraged the Government to initiate a sale following the agreed takeover of Vodafone's stake in Verizon Wireless, which will see tens of billions of pounds returned to UK investors.

:: A share placing is unlikely until later in the week at the earliest as Lloyds' managers focus on the successful spin-off of TSB into a standalone banking network on Monday.

:: Aides to Mr Osborne are determined to realise a return from part of the Lloyds stake before the Conservative Party holds its annual conference in Manchester next month. One said that recent improvements in the economic outlook allied to the imminent privatisation of Royal Mail and a sale of taxpayer-owned bank shares were part of "a narrative" that would bolster perceptions of the Chancellor's stewardship of the economy.

:: Senior Liberal Democrats are seeking assurances over Lloyds' future role in lending to small and medium-sized companies before they endorse any sale of Lloyds shares, according to Coalition sources.

The exact size of an initial Lloyds sale has not been determined, although analysts believe it is likely to account for roughly 10% of the bank's shares, or one-quarter of the Government's stake. That would be worth just over £5bn at today's share price just before the market close of 75.41p.

During the last 12 months, Lloyds shares have more than doubled as investors have begun to price in the bank's likely future profitability and potential shareholder returns.

In meetings with investors following last month's interim results, Antonio Horta-Osorio, Lloyds' chief executive, is understood to have pledged that the bank would seek to pay out up to 70% of its profits in dividends within three years.

Lloyds has been prohibited from paying dividends to ordinary shareholders since its £20bn bailout in 2008, which followed its takeover of the stricken mortgage lender HBOS.

Mr Horta-Osorio told Sky News this week that it was "the right thing" for the Chancellor to begin selling Lloyds shares.

The price of any Government placing of Lloyds shares would be crucial to Mr Osborne's presentation of a sale. The Labour government paid an average market price of 73.6p for the stake, and while an imminent placing may not take place above that level, it would be possible to do so for a price well in excess of the 61p at which the stake is recorded in the national accounts.

The lower figure does not take into account £2.5bn of fees paid by Lloyds for implicit guarantees covering its toxic loans in the wake of the 2008 rescue.

The Treasury, Lloyds and UKFI all declined to comment on Saturday.

00.02 | 0 komentar | Read More