This month Luke looks at the changing house prices, some improvement to interest rates, and also the General Election.
Hello and welcome to June’s blog, this month we will look at the changing house prices, some improvement to interest rates, and also it would be permissive to not talk about the General Election.
So there’s been some positive news from the Office of National Statistics, apparently house prices have increased by 5.6% in the year up to the end of April. That’s an increase from 4.5% up to the end of March, and shows there are some positive changes with house prices, although I would avoid making any overly bullish statements about the prospect of further house price growth this year. We all kind of expect there to be a subdued sales market between now and December. In fact that’s starting to bare out into some other data that’s coming to light, so sales of properties have dropped by a third in London according to YourMove, 19% overall across the United Kingdom, with London being the most affected.
And that’s really being blamed on the degree of Brexit uncertainty, but also the changes to stamp duty land tax were introduced on second homes and Buy to Lets in April last year, that’s starting to really take hold and cool the market down a little bit.
That’s not necessarily bad news if you are a first time buyer, or looking to move up the market, that may well provide some further options for you, and keep house prices in check as you save for your deposit. In terms of interest rates, we seem to keep repeating ourselves here, hit another low, remortgages are a new big thing for lenders, lenders are really driving there remortgage products opportunity to engage with new clients, and also to replace some of that lost purchase business that we are seeing.
So as a result remortgaging across the United Kingdom is at an eight year high, so consumers like you, have started to really see the benefit of switching mortgage rates, whether that’s to get a better deal, or raise money for home improvements or other purposes.
And as I said, it’s good news for first time buyers in terms of house prices, but also on interest rates, the number of available mortgage products for first time buyers has increased 14% year on year. There are now 287 mortgage products available specifically for first time buyers who have just a 5% deposit. And that really is good news, so that not only speaks volumes about how the industry feels about first time buyers, and the level of support for first time buyers, you will start to see the number of products expand and start to see a bit more competition on interest rates and hopefully some really great rates for first time buyers, or people looking to put down a small deposit.
As I said it would be remiss of us not to mention the General Election, and the immediate Brexit talks. So as it stands, there’s still no coalition formed but we do believe that the Conservatives will form a Government with the DUP.
In terms of the impact that’s happening on house prices, and the Money Market instruments that drive mortgage lending rates, it’s really having very little impact. In fact, Brexit overall, I think the market has adjusted for a lot of that. So certainly we have not seen any negative changes to Money Market rates to swap rates or to lend a sentiment towards lending. Fact quite the opposite, both are looking for more opportunities to lend and to engage with consumers.
So that’s it for this month, very much look forward to catching up with you next month, and if you any suggestions or would like any pieces featured next month, please feel free to email me, my email address is firstname.lastname@example.org