This week the Chancellor will deliver his Spring Statement, the dumbed down budget that is no longer a budget, it is hard to see exactly what he can do. In fact, unusually there has been zero speculation so far which shows just how low-key this has now become.
This time he will be trying to do something with both hands tied behind his back as the B-word overshadows everything. It will be interesting to see if he has any rabbits in his hat to pull out this time, but it looks pretty unlikely that anything to do with Housing will be too high up the agenda.
Last week, we saw reports that Annual Wage Growth is now outperforming house price growth at the fastest rate since 2011. This means housing affordability is getting slightly better which would usually help buoy the purchase market in normal conditions.
House Price Leap
Although, the Halifax Price Index came out and reported a bullish set of figures, with the biggest monthly house price rise on record in February. According to them “The average price of a home in Britain jumped 5.9 per cent to £236,800 in February”.
As we commented in The Evening Standard, what the February data underlines is that the lack of homes on the market, and broader supply deficit, have the potential to mitigate the impact of Brexit on house prices.
There’s all manner of political uncertainty at present but when it comes to house prices, the lack of supply could prove the property market’s trump card.
Sellers should not see this as a pretext to raise their prices, however. One month does not a market make.
Despite the sharp monthly rise, this is still very much a buyers’ market. Sellers need to be realistic if they want to sell and the majority now accept that.
Prospective buyers are increasingly waking up to the fact that the current window of opportunity could slam shut in the event of a Brexit deal and are being more proactive.
There’s a huge amount of pent-up demand out there and it’s starting to come through.
Amid all the chaos and mayhem, we’re seeing more movement, activity and transactions.
Mortgage rate wise things are still pretty much the same. For standard residential mortgages, borrowers can obtain 2-year fixes at 1.40%, (3.78% APRC) and 5-year fixes from 1.80%, (3.36% APRC) whilst variable tracker rates are around from 1.34%, (3.82% APRC).
Those looking at Buy-To-Let can still obtain products from just 1.46%, (5.30% APRC) for a 2-year tracker or 5-year fixes are available from 2.04% (4.40% APRC).