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Signs of mortgage market in UK recovering, says CML
Home lending appears to be on the brink of recovery after a dip due to new mortgage rules, the latest gross lending data from the Council of Mortgage Lenders suggests. The CML April estimate for total gross lending is £16 billion, 1% down on the previous month and 4% lower than the £16.7 billion of lending last April. But according to Mohammad Jamei, CML economist, lending appears to be in the throes of an incipient recovery even although lending in April was fractionally down on the previous month and year as this comes after a stronger March. ‘Overall, we now seem to be on the cusp of a modest lending recovery. Household finances are generally improving as earnings growth continues to outstrip inflation, and mortgages are being offered at extremely competitive rates. As a result, we expect to see stronger lending in future months,’ he said. Paul Smith, chief executive officer of haart estate agent, believes that the mortgage market is in rude health and despite the doom and gloom in the election run-up, consumers have been undeterred by the prevailing uncertainty. ‘Mortgage lending is still down on April 2014 but 2014 was an exceptional year where property prices and demand were speeding along beyond all expectation and an application of the brakes is no bad thing,’ he said. ‘Lower, but still strong, house price growth and levels of demand that aren’t dominating the headlines, is actually good for overall sentiment and both buyer and seller confidence. With the new majority government bedding in and the continued advantageous economic climate and government support for consumers, we expect mortgage lending to be on an upward trajectory for the rest of this year,’ he added. John Eastgate, sales and marketing director of OneSavings Bank, said that there is no doubt that pre-election jitters took their toll on borrower demand in April ‘But the mortgage market hardly ground to a halt. Mortgage rates remain near historic lows, and this continues to drive underlying activity,’ he pointed out. ‘On top of this, we have seen deflation take hold, pushing back the prospect of a hike in interest rates. Combined with improving earnings, this will boost the borrowers' budgets. With the new government now in situ, any lingering uncertainty has been put to bed, and sentiment has undergone a palpable bounce,’ he explained. ‘There are already signs that mortgage activity is on the increase, with big ticket purchases returning, and the market expects positive momentum to build as the year progresses. Yes, affordable mortgages for those with the smallest deposits remain thin on the ground, holding back first time buyer levels, but an increasingly buoyant buy to let market will support total lending in 2015,’ he added. Continue reading
UK property sales down month on month and on an annual basis
UK residential property sales fell by 3.4% between March and April and were 5.6% lower compared to the same period last year, the latest published figures show. The provisional seasonally adjusted UK property transaction count for April 2015 was 97,020 residential and 9,910 non-residential transactions, according to the official data from HMRC. Adrian Gill, director of Your Move and Reeds Rains estate agents, believes it can be put down to uncertainty in the run up to the UK general election at the beginning of May. ‘Only a few weeks ago, the outcome of this general election was a mystery and buyers were sitting on the fence to watch the spectacle unfold. Sales were stalling, and house price growth was also braking in many places across the country,’ he said. ‘Now, confidence is soaring and the prospects for the property market look rosy. Any ground lost before the vote will be made up by the ensuing sudden sprint, as demand now picks up the pace off the back of less stamp duty, competitive mortgage rates, and support schemes like the Help to Buy ISA,’ he explained. ‘This new unbridled momentum looks set to carry the market forwards for the remainder of the year, but now the election rhetoric has died down, the new government needs to get to the heart of the housing market’s remaining obstacle, a fundamental lack of available homes,’ he added/ Peter Rollings, chief executive officer of Marsh & Parsons, agrees. ‘Political anxiety clearly stalled housing market activity momentarily. Not many would have predicted an outright majority government, but the conclusive election result has launched a rocket of confidence in the property market, with buyers and sellers able to act with certainty again,’ he said. ‘The market above £2 million, which is already starting to digest the new higher stamp duty costs, is now free from the fear of an unfriendly mansion tax that would have encroached across much of the capital,’ he pointed out. ‘With the election done and dusted, we expect to see the market really awaken to the opportunities that are on offer with buyers acting quickly to take advantage of more available stock, better mortgage rates, lower stamp duty for those buying under £937,000 and Help to Buy schemes,’ he added. Continue reading
Real estate agents report an increased confidence in Spanish property market
There is a renewed confidence in the Spanish property market with both Spanish and English speaking agents recording an increase in overseas buyers. The latest Spanish property market confidence index from Kyero covering the first quarter of 2015 says that overall 71% of real estate agents feel more confident than they did a year ago and just 4% less confident. The survey also reveals that 30% of English speaking agents see stronger Sterling as being responsible for the most significant shift in the Spanish property market while Spanish agents believe that increased marketing is boosting sales. Some 56% of Spanish speaking agents and 57% of English speaking agents said that sales have increased, 34% and 31% said sales were static and 10% and 12% said sales had fallen. But there was a considerable difference of opinion regarding property prices. Some 49% of English speaking agents said prices have increased, but just 18% of Spanish speaking agents agreed. Indeed, 57% of Spanish agents said prices had remained the same compared to 34% of English speaking agents. A quarter, 25% of Spanish speaking agents said prices had fallen, and 17% of English speaking agents. Both Spanish speaking and English speaking agents reported a rise in buyers from overseas, at 59% and 64% respectively. Some 38% of Spanish speaking agents and 28% of English speaking agents said there was no change while 4% and 8% said there were fewer international buyers. Almeria, Fuerteventura, Gran Canaria and Murcia are highlighted as inspiring the most confidence, according to the index which surveyed 160 English speaking and 216 Spanish speaking estate agents across Spain. Martin Dell, director of Kyero, said that while the strength of Sterling has played a key role for English speaking agents who have used it to boost interest, Spanish speaking agents have taken a different approach. ‘While English speaking agents in Spain have been able to enjoy more confidence in the market thanks to the pound’s movements, their Spanish peers have been working flat out on their marketing activity in order to achieve the same goal,’ he explained. However, both sets of respondents reported similar figures when it came to buyer confidence, with 20% of English speaking agents feeling that improved buyer confidence had been the most significant change over the past 12 months, compared with 21% of Spanish speaking agents. Continue reading
