Birmingham throws hat in the bull ring

The Birmingham Midshires building society is already a hot tip to announce a windfall, following the long line of big names to do so in recent months. Now it's fanning the flames elsewhere.

Last week Midshires revealed it had made an "informal approach" to its more parochial society cousin, the West Bromwich, for a merger (for which, read takeover). Midshires said it would be prepared to pay a windfall to West Brom savers - and maybe borrowers - to convince them of the virtues of the deal.

West Brom said on Friday night that new savers could still open a qualifying membership account, though it remains to be seen for how long this will stay possible this week.

In public at least, however, West Brom's board says it is not interested in a deal with Midshires, describing the possibility as "wishful thinking" and claiming it wants to remain a "wholly independent, mutual building society". Of course, West Brom's board hasn't asked its savers and borrowers what they think - they're only the society's owners, after all.

Another potential problem, for new savers at least, is that the society recently raised its minimum opening balance to pounds 2,500 (the obvious choice is its 90-day account, although it also has a competitive fixed-rate Tessa for savers with maturing Tessas). Also, even if a deal did go through and there was a bonus, this might not amount to very much, perhaps even pounds 100 or less. Mergers among societies are not generally great for windfall hunters; Leeds Permanent members got nothing for agreeing to that society's "merger" with the Halifax, for example (although they will qualify for the forthcoming free share handout).

That said, if West Brom did succumb to Midshires, it would probably be just the first step towards an enlarged society demutualising. Midshires has already been suggested as a partner for the Woolwich, while last week there was speculation it would be taken over by Prudential. Whether Midshires gets West Brom or not, I reckon there's a good chance it will announce a windfall of its own this year.

To open a qualifying account with Midshires, new savers now need pounds 1,000. Try its postally-operated First Class Instant Access, paying 3.75 per cent on that amount.

House of horrors

I have given up on the housing market. Don't get me wrong, I'm not saying the recovery isn't happening - though I would warn against reading too much into the much-quoted surveys which say house prices are on the up. It seems to me that there is enormous variation between areas and types of property. In London, for example, traditional "first rung" properties continue to be relatively depressed in price.

But the big problem, as I can personally confirm, is that gazumping and contract races are back, at least in some of the gentrified areas of London. And that's in part why I'm giving up, or at least postponing, my first-time buy. I can't help thinking, or hoping, things will be easier in the autumn.

Come later in the year, confidence may well be undermined by the prospect (or even reality) of a Labour government and more expensive fixed-rate mortgage deals. Agents also complain about the shortage of decent properties being behind the current resurgence of gazumping and similar practices. The flipside of that shortage is that now is a popular time to buy (hence our guide to moving starting on page 18). But that supply-demand equation could all change again.