Another Day, Another House Price Rise
November 14th, 2006
Another day, another house price survey and, surprise surprise, the average house price has risen, and in London it has risen more than elsewhere.
The latest survey shows that house prices have risen by 6.30% in the last 12 months. One interesting point is that as this survey comes from the Land Registry and includes all house transactions it can be relied upon. Other surveys typically come from banks or building societies so only include property purchases that involve a mortgage transaction.
So why is a survey on house prices interesting to a life insurance specialist like us? Well, most life insurance sales in this country occur as a direct result of someone moving house. It is quite well ingrained in our society that if you are borrowing £150,000 in order to buy a house and put a roof over the heads of your dependants then it makes sense to put in place life insurance so that if you die the mortgage can be paid off and your dependants continue to live in the house.
However it is a sad fact that we often fail to realise that this is only half the job. Whilst it is fine to have the mortgage repaid, how will your family put food on the table, pay the gas and electricity bill, buy clothes, let alone have an occasional holiday? Very often, families are still faced with the prospect of having to downsize their home or move to a cheaper area despite the fact that the breadwinner had life insurance. This is because the breadwinner only had enough life insurance to repay their mortgage and didn’t put in place enough insurance to cover other living expenses.
We advise parents every day on their life insurance needs and one thing is universal, they generally underestimate the amount of life insurance that is needed to adequately provide for their dependants. £100,000 sounds like a lot of money, but when invested at say 4.5% per annum this will only provide £85 per week less tax… not a lot to live on, I think you’ll agree.
Life insurance has never been cheaper than it is at the moment. Use our calculator to get an idea of how much cover you should have in place and then try our online life insurance quote engine to get an idea of price. Alternatively get in touch with us and we can give you friendly advice over the phone. There’s no hard sell and we’re pretty sure you will learn something.
To view the house price survey visit the Land Registry website.
Author: Jason King
November 14th, 2006
Category: Life Insurance.
