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A market update from the beach

21.08.18

There’s nothing like a summer sojourn abroad to help you see things clearer from a distance and it is always interesting to take a step back.

What is evident is that, apart from the fact the rest of Europe thinks we are mad, almost every political and economic decision being taken at the moment is effected in some way by Brexit.

I suppose that is to be expected given the size of the task at hand but it is a shame that this is the case when we should be concentrating on things like housing.

We now have our 8th Housing Minister in 8 years in a role that needs an understanding of both the housing market and continuity. Let’s hope that the latest, Kit Malthouse gets some time to really do something.

All of this plays into the mortgage market as the recent Base rate rise filters through into mortgage pricing. The reality is that things are not that much different but some borrowers will see their affordability levels affected by such a rise. Lenders have been predictably quick in passing this rise on to the consumer where variable and tracker rates are concerned, whilst fixed rates, which had already priced in a rise, have only moved slightly up.

It seems all of this has had an effect on traditional levels of seasonality, with summer not quite as slow as it usually is which could translate into a faster than usual start to the final quarter of the year.

People will want to do things and be secure before we go into full Brexit uncertainty next year and with rates still low, lenders desperate to lend and house prices easing, it should be a busy climax to the year.

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