Is This A Buy Yet??????????? @115p

By Emma Ann Hughes | Published Nov 25, 2014
Paragon buy-to-let completions up 82.5%

Buy-to-let completions at Paragon rose 82.5 per cent to £656.6m for the year to the end of 30 September 2014.

Today (25 November), Paragon reported a lending total of £500,000 by Paragon Bank for the 12 months to the end of September, which commenced its buy-to-let operations during September 2014.

The indexed loan-to-value of the overall buy-to-let portfolio stood at 71.7 per cent at 30 September 2014 compared with 78.4 per cent at the end of 2013.

Annualised redemption rate on the total buy-to-let portfolio was 4.1 per cent in 2014 compared to 2.5 per cent in 2013, reflecting increased housing market activity.

Paragon Mortgages maintains a significant presence for the group in this growing sector of the UK mortgage market, contributing £80.5m to underlying group profit, a 14.5 per cent increase.

The aggregate new business pipeline stood at £414.8m at the year-end, 78.9 per cent above the level at 30 September 2013, underpinning strong growth rates into the new financial year.

Nigel Terrington, chief executive of Paragon, said: “The past year has seen considerable progress in the group’s strategic plans and in the performance of its businesses. Significant progress has also been achieved in diversifying further the group’s funding sources.

“In particular, the formation of Paragon Bank has provided us with the opportunity to diversify further both income streams and funding and we expect it to play an important role in the group’s future plans.

“The group benefits from a strong capital position and I am pleased to announce a 25 per cent increase in the dividend, as well as an initial £50m share buy-back programme, as we seek to complement strong and sustainable growth with improving shareholder returns.”

emma.hughes@ft.com

7 Nov 2014 Paragon Group of... PAG Berenberg Buy 414.05 403.10 450.00 450.00 Retains

SP target 450p

PAG Paragon .....

.hTTp://www.cityam.com/1416967256/paragon-banks-shift-home-owning

Buy-to-let baby boomers to become Britain's latest tax victims
Withdraw your pension to buy a second home and face punishing tax hit

By Anna White, Property correspondent2:30PM GMT 30 Nov 2014 Comments51 Comments
Enterprising baby boomers who choose to withdraw their pension in a lump sum to invest in a rental property will face a tax bill worth hundreds of thousands of pounds.
After the annuity reforms come into effect in April 2015, that will allow people to withdraw their pension in one go instead of being drip fed an annual income, it is likely many pensioners will consider sinking it into property. But they need to think twice, experts at PwC have warned.
An individual taking out £500,000 to buy a £750,000 second home, supplemented by a mortgage, will have to find nearly £200,000 to cover the tax bill.
A pensioner withdrawing £200,000 to buy a £500,000 home - around the average asking price of a home in London - will pay around £80,000 in tax, according to the giant accountancy firm.
While those who draw back a £100,000 lump sum to buy a £250,000 will pay between £29,000 and £36,000 dependend on tax code


A individual who wants to fund a buy-to-let project is hoping for house price appreciation over time and an income from the yield. However, the whole transaction could be taxed at as many as five different junctures.
They will face income tax when the amount is withdrawn, stamp duty on buying the property, income tax on the rental stream, plus capital gains tax if sold. And inheritance tax could eventually play a part, explained Iain McCluskey, tax director at PwC.
"The reforms to annuity are net positive for the Chancellor," he said.
The over 55s, known as the baby boomer generation, are comfortable with property as an investment having made 200pc house price appreciation in 20 years.
This and the UK's historically low interest environment will drive people to put their savings and pension into property, Mr McClusky added.
"While this generation trusts investments that you can see and touch they should also be wary of the extra costs on top of tax, such as maintenance of a property. They must exercise caution when taking out one lump sum and understand tax circumstances in one year."



So complicated are these latest tax reforms that the Government is providing a free tax advice service, face-to-face, over the phone and via a website, to help people choose the right pension product.
However, income tax relief on a quarter of a pension pot means that those with a big enough sum could use the first 25pc for a deposit to buy a home, with a mortgage, and avoid the first income tax hit, alhtough getting a big mortgage becomes far harder at this stage in life.
PwC does not expect further property tax announcements in this week's Autumn Statement.
"There is too little time to implement any fundamental reforms ahead of the general election," said Alex Henderson, head of tax at PwC.
However, leading property group, JLL, is calling for an overhaul of the council tax system and for Government to address the UK's housing shortage.

LATEST BROKER VIEWS

Date Broker New target Recomm.
1 Dec HSBC 410.00 Neutral
27 Nov Berenberg 450.00 Buy
26 Nov Numis 289.00 Sell
26 Nov Canaccord... 495.00 Buy
26 Nov Barclays... 445.00 Overweight
26 Nov JP Morgan... 420.00 Overweight
25 Nov RBC Capital... N/A Outperform
25 Nov Shore Capital N/A Buy
25 Nov Canaccord... 453.00 Buy
25 Nov Numis 244.00 Sell
Broker Recommendations for Paragon Group of Companies (The)