I mentioned last week that the cost of funds had fallen pretty dramatically and therefore lenders were reacting by cutting a whole host of rates. Well, a lot can change in a week and after some more positive noises around the potential for a Brexit deal, or having another extension agreed, we have seen SWAP rates bounce back up.
This could mean that lenders will put up rates a tad again, however, the competitive pressure they are now feeling to have a good end to the year should temper this. Either way, I really do think that those looking to buy now have the best chance of locking into some outstanding rates and will have others looking back in envy.
It is good to see that First-Time buyers are still very much the lifeblood of the industry, with the latest UK Finance Household Finance data report showing that the number of First Time Buyer mortgages completed in July rose by 5.8% year-on-year to reach 32,640 that month. First-time buyers continued to drive the mortgage market during the summer months, which is once again reflected in this data.
What’s particularly encouraging in this data is also the pick-up in buy-to-let purchase mortgages. After a tumultuous four years, the market appears to have bottomed out. Buy-to-let will never be the force it once was but on this evidence there is life in it yet.
Remortgage business is still stable and we would urge borrowers coming to the end of their product term to not rush into a product transfer direct with their lender without taking a little advice. While the rates being offered might look competitive, there may well be something better out there. What is more, it is the perfect opportunity to revisit the length of the term as you may well be able to reduce the number of years left on your mortgage and save a whole heap of interest.
In summary, the property and mortgage market as a whole is ticking along nicely given the depth of political uncertainty. Brexit may still dominate the airwaves but it’s no longer causing people to put their lives on hold, and I think it will be a busy end to the year.
Rate wise, for standard residential mortgages, borrowers can obtain 2-year fixes at 1.24%, (3.71% APRC) and 5-year fixes from 1.57%, (3.23% APRC) whilst variable tracker rates are around from 1.24%, (3.80% APRC).
Those looking at Buy-To-Let can still obtain products from just 1.37%, (4.89% APRC) for a 2-year fixed or 5-year fixes are available from 1.87% (4.33% APRC).