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Extent of UK mortgage market change shown in annual stats
Home lending fell to £51.3 billion in the final three months of 2014, a drop of 8.1% compared with the previous quarter but was just 0.2% lower than the same quarter in 2013, new data shows. The figures from the Bank of England also shows that new commitments also decreased, from £53.6 billion in the third quarter of 2014 to £46.3 billion in the fourth quarter, a decrease of 8% compared with the final quarter of 2013. The proportion of gross advances at fixed rates decreased for the first time in nine quarters falling to 82.2% in the fourth quarter from 82.6% in the previous quarter. The quarter three out turn was highest since the figures began at the beginning of 2007. The value of residential loans advanced to first time buyers decreased over the quarter to £11.2 billion from £12.1 billion in the previous quarter and the third quarter out turn was the highest since the third quarter of 2007. Buy to let (BTL) lending increased from £6.6 billion in the fourth quarter of 2013 to £7.6 billion in the fourth quarter of 2014 and the proportion of gross advances at an LTV over 90% decreased by 0.5% over the quarter to 3.8% in the fourth quarter of 2014. The figures show overall that the lending landscape has been extensively reshaped over the past year, according to Adrian Gill, director of Your Move and Reeds Rains estate agents. ‘Fresh regulations and affordability checks have cultivated a much healthier mortgage market. Mortgage approvals may take longer to come to fruition, but buyers are benefiting from a more thorough and considered borrowing process,’ he explained. He believes that in the longer term, providing customers with the most suitable mortgage product for their needs is of paramount importance at a time when front-end demand is beginning to blossom in 2015, as consumer confidence grows. ‘Slashed stamp duty fees and more gradual house price growth are bringing homeownership closer within reach of aspiring buyers, while at the same time rock bottom inflation and competitive mortgage deals are giving borrowers a boost,’ he pointed out. ‘Buyers are finding brilliant deals on homes, and this front-end sales activity will soon trickle down to completions, feeding the property recovery,’ he added. Continue reading
Positive outlook for sales and lettings markets in south and east London
The sales and lettings market in the South East of London are set to be buoyant in the coming months due to high demand, according to a new analysis report. There has been a notable migration of buyers from parts of North and West London setting up home in the Royal Borough of Greenwich thanks to it being comparably good value for money, according to the report from JLL. The associate director at the firm’s Blackheath office, Graham Lawes, said that this, coupled with high local demand, is fuelling the prices and momentum is set to continue throughout the year. ‘For City workers, the accessibility to Canary Wharf is a huge attraction. Young professionals and high earners are drawn to the area thanks to the addition of new boutiques, high end restaurants and bars opening in the historical borough. Families are also attracted to the Royal Borough thanks to its excellent local schools with impressive Ofsted reports,’ he explained. He pointed out that it is widely regarded that parts of the South East of London will see prices rise beyond the national average and that there is a huge disparity from one side of London to the other. The imminent arrival of Crossrail will add to this. ‘Blackheath and Greenwich will continue to attract interest but I anticipate Lewisham (SE13) Charlton (SE7), Woolwich (SE18), Plumstead (SE18), and Abbey Wood (SE2) to see the largest growth percentages over the next year as properties there are excellent value,’ added Lawes. The area’s rental market has also been strong, according to Charlotte Russell, assistant lettings manager of JLL’s Greenwich office. ‘This year, the rental market in Greenwich and Blackheath has been particularly strong for one and two bedroom properties. These properties have achieved up to 18% increases in rents year on year in some areas, largely due to relocation for employment into Canary Wharf and the City,’ she said. ‘Such relocations have positively impacted the rental market, particularly now that Greenwich is offering riverside developments to match Canary Wharf, and this has increased both the popularity of the area and spectrum of tenants. Additionally, we are seeing more people staying in their properties longer term with minimal void periods between tenancies,’ she explained. Looking ahead to spring, the firm anticipates that the rental market will remain buoyant, particularly going in to the warmer months, when tenants prefer to move with riverside living likely to remain popular with potential tenants. ‘We hope that new developments such as Platinum Riverside, Greenland Place, Peninsula Tower, and the ever growing Royal Arsenal Riverside in Woolwich, will keep the market in good supply as the demand increases,’ added Russell. In the City and East London property sales market there is likely to be a focus on what happens with Canary Wharf with the estate being sold to a Qatari led bid and planning passed to develop Wood Wharf. But in the… Continue reading
BSA calls for more financial help for young UK home buyers
The UK’s annual Budget will be unveiled next week but ahead of the announcement the Building Societies Association has written to the Chancellor of the Exchequer asking for urgent help for buyers. The BSA says that younger buyers in particular need concerted help to buy their first home and has suggested a way in which money could be raised to give it to them. The money raised by the government from the sale of the NS&I 65+ Pensioner Bonds, estimated to reach £15 billion by the current closure date of 15 May, could be used to offset an initial investment in affordable housing projects, the letters says. Specifically, the BSA letter says that this money could make a lasting difference if it was used as seed funding for perpetually affordable housing developments using a model such as a Community Land Trust. ‘Using the money raised from the Pensioner Bonds to make affordable housing available to young people seems a neat way for a scheme that benefits those 65 and over, to also help younger people who face such a chronic shortage of affordable housing,’ said Robin Fieth, BSA chief executive. The letter also calls for the government to boost the range of providers within the house building sector, including specific support for small to medium size builders, custom and self build builders and co-operative and shared housing models. ‘The UK’s volume house builders alone cannot alleviate the acute shortage of housing in the country,’ it adds. Next week, two days before the Budget, the BSA will launch its housing manifesto for the forthcoming general election which will include a call for the creation of a new housing ministry with a Secretary of State with a seat in the Cabinet. It says this would be better than the current situation when housing is spread among a variety of government departments. The BSA is also backing the idea of a cross political party 15 year plan for the UK’s housing market based on national and regional long term demographic changes, employment, environmental concerns and infrastructure. Continue reading
