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Bank Base Rate cut to 0.25%

Thursday, 04 August 2016 14:17
The Monetary Policy Committee (MPC) took the historic step of slashing rates to 0.25% at midday today, in a bid to settle post-Brexit vote markets and drive up consumer confidence. Until today, the Bank of England Base Rate had been held at 0.5% since March 2009.

The Bank of England has also extended Quantitative Easing (QE) by £60bn to £435bn by a vote of 6-3. In the second meeting of the Bank of England’s Monetary Policy Committee (MPC) since the UK’s momentous Brexit decision, members voted unanimously to cut the Base Rate to 0.25%.

The MPC also voted by 8-1 to introduce a scheme to buy £10bn of high-grade corporate bonds. This is the lowest the rate has ever been and is a long way from the record high 17% interest rate recorded in November 1979.

It is still too early to see how much of this rate cut will be reflected in mortgage rates for new borrowers but any existing borrowers on tracker rates will see a slight reduction in their mortgage payments

Good times for First Time Buyers

Wednesday, 06 January 2016 10:08
The latest First Time Buyer tracker from Your Move and Reeds Rains shows the number of completed First Time Buyer (FTB) transactions rose to 31,300 in November. This equates to a monthly increase of 4.7% and a notable rise of 23.7% year-on-year, with 25,300 FTB sales recorded during November 2014. Significantly, it also marks the highest figure seen since August 2007, before the financial crisis took hold, when the number of completed transactions stood at 35,300.

The average price of a typical FTB property has fallen on both a monthly and annual basis. The typical price currently stands at £148,385, down 3.0% from October and a drop of 4.7% year-on-year.

Affordability has also improved on a wider basis, partly fuelled by the drop in purchase price, with the average FTB deposit of £24,598 down 4.2% over the year and mortgage repayments now accounting for 18.6% of income, down 0.5% from October and 1.7% from November 2014.

Take advantage of the current low mortgage rates before they disappear

Tuesday, 26 January 2016 11:14
Fixed mortgage rates continued to fall last year despite expectations that a rise in base rate was drawing closer. According to the new research from Moneyfacts, mortgage rates across all terms and loan-to-values (LTV) dropped significantly during 2015 as competition among providers intensified. Among two-year fixed rate mortgages, rates at 60% LTV fell from 2.07% a year ago to 1.99% today, while at 75% LTV, the drop is even more significant, from 2.85% to 2.16%. First-time buyers with just a 10% deposit (90% LTV) have also seen their potential monthly payments plummet, with rates dropping from 3.84% last January to 3.06% now. A similar scenario is also apparent on five-year fixed rate mortgages, with rates at 60% LTV dropping from 2.97% to 2.66%, rates at 75% LTV reducing from 3.25% to 2.94% and rates at 90% LTV sliding from 4.56% to 3.79%. Charlotte Nelson, finance expert at Moneyfacts, said borrowers should take advantage of the current low mortgage rates before they disappear. "Mortgage payments are one of the biggest financial outlays a homeowner can have, so it's a no-brainer to grab a low rate deal while they're still available," she added. "Of course, borrowers need to look at the mortgage as a whole to ensure they get the best deal for them, but by taking advantage of the rates on offer today, they could end up saving a significant amount of money."

Latest Nationwide house price index results

Monday, 04 January 2016 10:24
Annual house price growth rose to 4.5% during December, the latest Nationwide House Price Index shows, up from the increase of 3.7% recorded the previous month and the strongest annual growth rate seen since May this year (4.6%). Prices also increased on a quarterly basis, rising by 1.4% and marking a 15-month high, being the strongest quarterly growth rate seen since September 2014 (1.7%).

Improvement was also apparent on a monthly basis: UK house prices rose by 0.8% from November, up from a marginal increase of 0.1% the previous month, and the largest rise seen since April (1%). It puts the price of a typical UK home at £196,999. The report noted that house price growth has been fairly consistent during the second half of the year, with general increases of between 3% and 4.5% being "broadly in line with earnings growth and close to the pace we would expect to prevail over the longer term," said Robert Gardner, Nationwide's chief economist.

FTB sales at 6-yr high

Wednesday, 02 December 2015 09:22
Sales to first-time buyers (FTBs) have hit their highest level in six years, figures from the National Association of Estate Agents (NAEA) have revealed. The October Housing Market Report, released earlier this week, shows that house sales to FTBs accounted for 31% of total sales in October, the highest since August 2009. The figure also marks the second consecutive monthly increase, with FTB sales making up 29% of sales in September and just 20% in August.

Boost in remortgaging activity

Thursday, 19 November 2015 09:27
Remortgage activity in the UK has soared over the past year, figures from Connells Survey & Valuation have revealed, with the number of remortgage valuations carried out in October being 53% higher than a year earlier. This improvement comes despite the usual seasonal fall, which saw activity drop by 21% from September.

Remortgaging activity at 6-year high

Wednesday, 25 November 2015 10:29
Monthly gross remortgage lending has hit its highest level since 2009, figures from LMS have revealed, with the total standing at £6.1bn in October. This is 20% higher than the £5.1bn recorded in September and is up a significant 49% year-on-year, with £4.1bn of loans recorded in October 2014.

The number of remortgage loans saw similar increases, with a total of 37,744 advanced during the month - an increase of 22% on a monthly basis (up from 31,000 in September) and up 40% year-on-year (27,000).

"Remortgaging is back with a bang, and rightly so as borrowers capitalise on the competitive offers currently available," said Andy Knee of LMS. "However, we're nowhere near pre-recession levels, showing that there is plenty of capacity for continued growth over coming months and years. We have all the right conditions in place for a remortgage resurgence”

Courtesy of Moneyfacts

House price growth strengthens

Wednesday, 18 November 2015 10:01
Figures from the Office for National Statistics (ONS) reveal that house prices rose by 6.1% in the year to September, up from the increase of 5.5% recorded the previous month and the strongest rate of annual growth seen since March 2015 (9.6%). It also means that the average price of a UK home has hit a new record high of £286,000.  

However, the rate of annual growth very much depends on geography and which region you live in. It was mainly driven by Northern Ireland, which saw prices rise by 10.2% year-on-year, followed by England (up 6.4%). Prices in Scotland and Wales both rose by a more moderate 1.1%. Meanwhile, annual increases in England were driven by rises in the East (8.4%) and the South East (7.4%), with the North East reporting the lowest annual growth of all regions (1.8%).

Buy-to-let rates at record low

Wednesday, 18 November 2015 09:49
New research from Moneyfacts has revealed that buy-to-let mortgage rates have dropped to record lows as high rents and increasing rental demand see lenders do all that they can to secure their share of a booming market. According to the latest data, the average two-year buy-to-let fixed mortgage rate has dropped from 5.23% in November 2010 to just 3.26% today, while rates on five-year deals over the same period have fallen from 6.12% to 4.06%.

The number of fee-free buy-to-let mortgages has also increased in that time, too, and doubled over the course of the past year alone, and is being seen as a sign that lenders are trying to diversify and offer borrowers more choice.

Growing incentive to remortgage

Friday, 11 September 2015 09:30
The latest Moneyfacts UK Mortgage Trends report has revealed further incentive for borrowers to remortgage, with the gap between the current SVR and the average mortgage rate of two years ago now standing at 1.37%. This margin has risen by 0.32% in recent months - in April and May this year, the difference stood at 1.05% - which means that borrowers sitting on their SVR, or those approaching the end of a fixed rate term, will now have significant motivation to remortgage.

Landlord confidence remains strong

Tuesday, 15 September 2015 09:22
Confidence among landlords remains strong despite the changes outlined in the Summer Budget, latest research from Martin & Co estate agents has revealed. The survey showed that almost half of private landlords are seeking to expand their portfolio, the same percentage as was recorded prior to the Summer Budget, with the cuts to tax relief not appearing to be a deterrent. Many are seeking to expand their geographical reach, too, with a third of multi-property owners having a rental property that's at least 100 miles from their home. The figures went on to reveal the potential attraction of investing in buy-to-let, particularly in the wake of the pension freedoms: in six out of nine UK regions surveyed, the rental income from a property exceeds the typical income a pensioner could earn from an annuity.

House purchase lending at 18-month high

Friday, 11 September 2015 09:22
The number of mortgage approvals for house purchase has risen to an 18-month high, the latest Mortgage Monitor from e.surv has revealed, with 69,220 approvals recorded during August. This is an increase of 9.3% year-on-year and the highest monthly total seen since February 2014. Notably, the number of small deposit borrowers - those with a deposit of 15% or less - has risen to a post-recession high, with 11,975 small-deposit house purchase loans approved in August.

Growing incentive to remortgage

Friday, 11 September 2015 09:30
The latest Moneyfacts UK Mortgage Trends report has revealed further incentive for borrowers to remortgage, with the gap between the current SVR and the average mortgage rate of two years ago now standing at 1.37%. This margin has risen by 0.32% in recent months - in April and May this year, the difference stood at 1.05% - which means that borrowers sitting on their SVR, or those approaching the end of a fixed rate term, will now have significant motivation to remortgage.

Landlord confidence remains strong

Tuesday, 15 September 2015 09:22
Confidence among landlords remains strong despite the changes outlined in the Summer Budget, latest research from Martin & Co estate agents has revealed. The survey showed that almost half of private landlords are seeking to expand their portfolio, the same percentage as was recorded prior to the Summer Budget, with the cuts to tax relief not appearing to be a deterrent. Many are seeking to expand their geographical reach, too, with a third of multi-property owners having a rental property that's at least 100 miles from their home. The figures went on to reveal the potential attraction of investing in buy-to-let, particularly in the wake of the pension freedoms: in six out of nine UK regions surveyed, the rental income from a property exceeds the typical income a pensioner could earn from an annuity.

House purchase lending at 18-month high

Friday, 11 September 2015 09:22
The number of mortgage approvals for house purchase has risen to an 18-month high, the latest Mortgage Monitor from e.surv has revealed, with 69,220 approvals recorded during August. This is an increase of 9.3% year-on-year and the highest monthly total seen since February 2014. Notably, the number of small deposit borrowers - those with a deposit of 15% or less - has risen to a post-recession high, with 11,975 small-deposit house purchase loans approved in August.

Annual house price growth at 9%

Friday, 11 September 2015 09:17
The latest Halifax House Price Index has revealed that house prices in the three months to August were 9.0% higher than in the same period a year ago, up from the annual growth rate of 7.8% recorded in July. Prices also grew by 2.7% on a monthly basis, the highest seen in well over a year, easily reversing the 0.4% loss recorded the previous month. This puts the price of a typical UK home at a new record of £204,674, with the ongoing supply and demand imbalance meaning that price growth is likely to continue. "The underlying pace of house price growth is strong," said Martin Ellis, Halifax housing economist. "The shortage of second-hand properties for sale on the market is resulting in upward pressure on house prices. At the same time, economic recovery, real earnings growth and very low mortgage rates are supporting housing demand. Strengthening demand and highly constrained supply are likely to mean that house price growth continues to be robust in the short term."

Householders expect rate rise in next six months

Thursday, 20 August 2015 08:44
Almost half of households are preparing themselves for an interest rate rise during the next six months, a survey has found. Forty eight per cent predicted that the Bank of England will raise rates, the highest figure since July 2014 and up from 34 per cent last month. The proportion expecting a rate rise in the next year stands at 78 per cent, according to the Markit Household Finance Index. Mark Carney, the Bank's governor, indicated in a speech last month that rates could rise from the record low of 0.5 per cent by the year end, but the Bank's latest economic outlook pointed to no change until well into 2016.
[The Times 20.8.15.]

Buying is £672 cheaper than renting

Monday, 24 August 2015 08:47
The cost of buying a first home is now £672 a year lower than renting, research from Halifax has revealed. The average monthly costs associated with buying a three-bedroom house in the UK for a first-time buyer was £666 in June 2015, 8% (or £56) lower than the average rent paid on the same property type, which currently stands at £722 per month.  
 "Looking at monthly costs, the combination of lower mortgage rates and declining rental value over the past six years has made it cheaper to buy than to rent," said Craig McKinlay, mortgage director at Halifax.

Strong August for housing market

Tuesday, 18 August 2015 09:22
August has seen its strongest house price performance since 2007, research from Rightmove has shown, with prices falling by a mere £2,258 month-on-month. August typically sees a seasonal drop in house prices due to the holidays, but the latest House Price Index showed that national average house prices dropped by just 0.8% from July, a much more muted fall than those seen before the credit crunch, where August prices typically fell by an average of 1.5%. This puts the average price of property in the UK at £292,284, down from July's average of £294,542.

Buyer demand at 17-month high

Friday, 14 August 2015 08:37
The latest RICS Residential Market Survey has revealed that buyer demand during July rose at its fastest pace since February 2014, resulting in strong price momentum as supply continues to tighten. New buyer enquiries rose for the fourth consecutive month, with all areas bar the South East reporting an increase in demand. Whilst demand is increasing the number of house for sale have fallen by 20% since January this year. This has helped national house price inflation accelerate for the sixth month in succession. Both near-term and 12-month price expectations remain robust, with all areas predicted to see sizeable house price growth in the next year.
Report courtesy of the Royal Institute of Chartered Surveyors

House price growth slows

Tuesday, 11 August 2015 09:15
The latest Halifax House Price Index has revealed that house price growth slowed substantially in July, with annual inflation standing at 7.9%, down from the rate of 9.6% recorded in June and the lowest seen since December last year. Prices dampened even further on a monthly basis, falling by 0.6%, to put the price of a typical UK home at £198,883. However, the supply and demand imbalance continues, suggesting that strong price growth will remain.

FTB's can save thousands

Tuesday, 11 August 2015 09:08
Research from Moneyfacts has revealed that first-time buyers who take out a mortgage today, compared to two years ago, can save an estimated £2,000. This is due to an abundance of record low mortgage rates on the market, fuelled by the launch of the Help to Buy Mortgage Guarantee scheme, which has encouraged lenders to undercut the government backed deals. The average five-year fixed Help to Buy mortgage now charges 5.12%, whereas the average for those outside of the scheme is just 4.78%. In addition, the number of deals available to first-time buyers has increased from 42 back in August 2014, to a staggering 195 deals today. 
Moneyfacts 11th August 2015

Mortgage rates begin to edge up

Thursday, 06 August 2015 08:35
Research from Moneyfacts reveals that average mortgage rates, particularly those at lower LTVs, have started to edge up over the last month, suggesting that the run of record lows is coming to an end. Rates at 60% LTV have been cut the most, with the average rate for a two-year 60% LTV deal rising from 1.81% in July to 1.88% today. The five-year version has witnessed a similar increase, up from 2.54% to 2.59% over the same period. Much of this can be attributed to Mark Carney's speech on 14th July, where he indicated that base rate could rise around the turn of the year.

People who are looking to remortgage and all those on a lenders standard variable rate should consider switching to a fixed rate now whilst the rates are still low.

Buy-to-let market set to expand in first half

Thursday, 17 January 2013 11:34
Around 55% of landlords are planning to expand their portfolios in the next six months according to research by Mortgages for Business. Of these the research shows that two-thirds will need to refinance.

The research, which polled 218 investors, suggests landlord appetite for more purchases stems from the attractive yields available on residential investments. High gross yields on residential property – which currently stand at 6.7% – are encouraging landlords to expand their portfolios even further.

Of those investors who intend to expand their portfolios this year, almost nine in ten (88%) plan on buying more residential property.

Right to Buy sales double in five years

Friday, 11 October 2013 09:07
Sales of council and housing association homes have doubled in the last five years, according to Communities and Local Government figures. In the year to April 2013, 8,398 council and housing association tenants took up their Right to Buy - more than double the sales seen in the previous year and the highest level since 2007.

In April 2012, the government increased the maximum discount to £75,000 across England in April 2012 . Prime Minister David Cameron said: "The success of Right to Buy shows how the new reinvigorated scheme is opening up the prospect of home ownership to even more people across the country."

First time buyers borrowing is the largest monthly total since 2009

Thursday, 17 January 2013 11:04
The number of loans taken out by first-time buyers reached the largest monthly total since the end of 2009 in November, according to new data released by the Council of Mortgage Lenders. A total of 21,700 loans were advanced to first-time buyers in October, worth £2.7 billion, representing an 8 per cent rise compared to October and up by 24 per cent on November last year.

For the second consecutive month, loans to first-time buyers accounted for 41 per cent of all house purchase loans. This is rather higher than the usual proportion of around 38 per cent. Commenting on the data, CML director general Paul Smee said: “Encouraging activity in the first-time buyer sector in November contributed to an uplift in house purchase lending suggesting that the underlying trend for year-on-year increases should continue."

UK interest rates could stay at 0.5% until 2017

Monday, 07 January 2013 12:42
UK interest rates will stay at rock bottom per cent for another four years as the economy struggles to recover, according to a leading investment bank. Citi says it expects rates to stay at 0.5 per cent until the middle of 2017 – a year longer than previously expected.

The prediction would see interest rates held at 0.5 per cent for eight years, having been cut to the low back in March 2009. Citi chief UK economist Michael Saunders says that they have also cuts its growth forecast for the UK in 2013 from 0.8 to 0.4 per cent and said output would only rise between 0.5 and 1 per cent in 2014.
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