Tag Archives: crisis
Easy mortgage access for home buyers in the US tightens
Access to mortgage credit in the United States tightened in the first quarter of 2015, marking a pause in easy accessibility for buyers. It had been getting progressively easier to obtain a mortgage since 2012, but the first several months of this year marked a change, according to according to the latest Zillow Mortgage Access Index (ZMAI). Mortgage credit availability is almost unchanged from a year ago, meaning despite fluctuations from quarter to quarter, there has been little progress toward making mortgages easier to obtain over the last year. In the long term, experts expect mortgage access to continue improving. In a survey earlier this summer of more than 100 economists and housing experts, more than 60% said they expect mortgage regulations to loosen further, with many expressing concern the market will become too lax over the next year. A high number in the Zillow Mortgage Access Index means credit is easier to obtain, while a lower number means credit is tighter. Mortgage credit was easiest to obtain in July 2004, when the ZMAI reached 136.4. But availability tightened over the next few years. In May 2007, both the housing and mortgage availability began a multi year plunge, leaving home values down more than 22% and credit the tightest in recent history. Mortgages were the toughest to obtain in September 2010, when the ZMAI was at 11.8. Today, access to mortgage credit has improved significantly, and is at 65, more than two thirds of the way back to 2002 pre-crisis levels. 'Recent market volatility is causing some lenders to be more cautious in their underwriting. Tighter mortgage access will make it harder for people with low credit scores to get a home loan, and even people who can get approved for a mortgage will have fewer options in terms of available mortgage products,' said Zillow chief economist Svenja Gudell. Continue reading
Remortgage valuation surveys up over 100% year on year in UK
Remortgaging activity in the UK increased in August, outperforming all other areas of the housing market, according to the latest research. The number of valuations for remortgaging rose 25% compared to July and on the back of this growth, the number of remortgage valuations is now up by 102% compared to August 2014, the data from Connells Survey and Valuation shows. However, total valuation activity was more muted in August. The number of valuations across all sectors, including remortgaging, rose by 7% compared to July, up 48% compared to August 2014, driven in large part by remortgaging. According to John Bagshaw, the firm's corporate services director it is concern and media attention about an interest rate rise in the near future is the key driver of this surge. 'Due to the very low Bank of England base rate, there are currently some very appealing remortgaging deals on offer from lenders. But home owners have been influenced by a powerful perception that these deals will not last,' he said. He pointed out that underneath the short term surge, remortgaging is also driven by a longer term shift. People are increasingly looking to upgrade their home rather than trade and so, for a slightly different purpose, are also keen to take advantage of cheaper mortgage deals. Meanwhile, the wider picture looks encouragingly stable. First time buyers and home owners are far more optimistic about the housing market now than they were at this point in 2014 and this is evident from the strong, steady growth seen throughout 2015 so far. The data also shows that the number of valuations for existing owner occupiers looking to move home has grown by 3% since July. This leaves activity on behalf of home movers up by 30% compared to August 2014. A similar picture emerges for first time buyers. The number of valuations carried out in August for those looking to take a first step onto the property ladder rose 1% month on month and 31% on a twelve month basis. 'Home mover and first time buyer activity has seen sizeable and speedy growth over the last six months, so a period of more stable growth is a sign of consolidation. It shows that these sectors command long term momentum and demonstrates a more stable optimism from households about the future,' said Bagshaw. 'For those moving up the ladder, low mortgage rates are combining with property price growth as a basis for their next purchase. Meanwhile, first time buyers don’t have the benefit of this natural deposit, but are showing remarkable fortitude in the face of price rises, buoyed by a jobs market that is increasingly showing real wage growth,' he added. In the only section of the market to see a drop in August activity, valuations for buy to let purposes dipped by 5% on July. Despite this, compared to a year ago, the total number of valuations… Continue reading
Key commuter city sees prime property market perform best in UK
Winchester, a popular commuter city within reach of London has seen its prime property prices outperform the wider UK market, new research shows. Prices in the city, famous for its cathedral and history, increased by .4% between April and June, taking the annual change in prices in the city to 6.3%, according to data from international real estate firm Knight Frank. Such price growth means that Winchester has comfortably outperformed the wider UK prime market where values have risen by 0.9% on a quarterly basis and 2.3% on an annual basis. Winchester has also registered stronger price growth than other prime city markets including Bath, Bristol and Oxford. A shortage of prime properties for sale, combined with strong demand for homes in thriving town and city markets, has contributed to this out performance, according to the Knight Frank analysis report. It shows that the number of properties for sale in the city was 17% lower at the end of July than at the same point a year previously. In the prime market, the number of properties for sale valued at over £500,000 was 20% lower, a factor which, combined with strong demand, can put upwards pressure on prices, the report explains. Against this backdrop, demand for property in Winchester remains widespread.'As well as those moving up the ladder locally, the city remains popular with commuters both from the wider South East region and from London. Figures from the 2011 Census show that some 53% of people living in Winchester work outside of the city,' the report says. Buyers from the capital are also taking advantage of the price differential between property prices in London and elsewhere in the country. The report points out that while there has been sustained price growth in Winchester over the last year, changes to stamp duty announced in December have made buyers at the top end of the market more price conscious. This has resulted in slower than average price growth for the most expensive properties in the city since the introduction of the new rates. Meanwhile, in geographical terms, price growth has been fairly uniform across the city. Property values in Hyde and the city centre have risen by 3.2% and 3.1% respectively over the first six months of 2015, and by 6.9% and 6.8% over the past year. To the south and the east of the city centre in St Cross and St Giles Hill annual price growth of 5.7% and 6% respectively has been recorded. Overall, there were over 200 sales with a value of £500,000 or more in Winchester over the 12 months to June, 23% higher than the previous 12 months, according to data from the Land Registry. Continue reading
