Welcome to another exciting week!
It has been a more positive week with regards to lenders coming back with more products, albeit only a slight variation at the margins, but these days we take what we can get!
TSB has come back to help first-time buyers with a 15% deposit which importantly also has a lower follow-on rate. This is important because it means that the stress test they need to do on new borrowers affordability is done at a lower rate, which means that applicants could be able to borrow that little bit more.
Barclays has added another 20 products to its range, replacing some of those that it withdrew earlier in the year and they also have an 85% LTV 5-year fixed option. They have also added another 2 products at 85% LTV in their “Green Mortgage” suite of products, available on qualifying new build properties from their partner housebuilders.
Coreco also have access to an exclusive product at 90% LTV for Key Workers, although this is limited access for 48 hours from today!
There is a substantial amount of pressure being put on lenders now to start to come back to market as we are seeing demand ease very slightly and mortgage lenders have had a number of months now to try to improve the situation.
Valuers are also under some pressure as they should be reflecting the market at a point in time rather than looking ahead at what may happen. We still see some down valuations occurring, but with more reports like the latest figures from the ONS saying that prices rose 2.5% in August, this looks out of kilter.
Some suggest we will see annual house price growth of around 7% in all this year but tailing off to anything between -2% to 2% growth next year. Either way, the chances of a property crash are very unlikely, and the doom-mongers should be ignored.
According to HMRC, housing transactions recorded a level of just over 98,000 in September which was on a par with the same month last year, up 21.3% on August. The property market is yet again proving how unique and robust it is.
Meanwhile, the Bank of England continues its “talk” around negative interest rates, which could actually be a classic case of the strategy of the “Maradona feint”. Coined in reference to the Argentine football legends second goal against England in the 1986 World Cup where he seemed to dribble in different directions sending England players scattering, when in fact he just feinted left and right and actually ran in a straight line.
Whether it is just a bluff to get markets to react a certain way only time will tell.
In terms of mortgage rates, for standard residential mortgages, borrowers can obtain 2-year fixes at 1.20%, (3.30% APRC) and 5-year fixes from 1.43%, (2.90% APRC) whilst variable tracker rates are around from 1.69%, (3.40% APRC).
Those looking at Buy-To-Let can now obtain products from 1.22%, (4.80% APRC) for 2-year fixed or 5-year fixes are available from 1.62% (3.77% APRC).