2nd September 2010

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12th August 2010

Buy-to-let market continues to grow, say CML
12 August 2010

The freezing up of the buy-to-let mortgage market that emerged as an unwelcome side-effect of the credit crunch appears to have eased a little, according to the latest buy-to-let survey results from the Council of Mortgage Lenders

11th August 2010

Fixed rate mortgages gained in popularity in June

48% of new borrowers took out a fixed rate mortgage in June, the highest proportion so far in 2010, according to new data from the Council of Mortgage Lenders.

Fixed rates had proved unpopular this year compared to the last several years due to an historic low bank rate with little prospect of the rate rising. But with fixed rate prices falling they are starting to find favour again.

House purchase lending increased significantly in June. There were 52,000 loans advanced (worth £7.6 billion), up 19% in volume (23% in value) from May 2010 and up 14% in volume (27% in value) from June 2009. This is now the twelfth consecutive month in which lending has been higher than its year-earlier levels.

Lending for remortgage also increased, though only modestly, in June. There were 27,000 loans for remortgage, worth £3.4 billion, up from 26,000 (worth £3.2 billion) in May 2010 but down from 34,000 (worth £4.2 billion) in June 2009.

For the second quarter as a whole, there were 136,000 house purchase loans, worth £19.7 billion. This is 20% higher (by volume and value) than the last quarter and up 17% (by volume) and 30% (by value) than quarter two 2009.

For remortgaging, the second quarter saw 77,000 loans (worth £9.6 billion), up 2% by volume, with no change in value, from the first quarter, but in stark contrast to house purchase lending, the figure was down 20% (by volume) and 19% (by value) from the second quarter of 2009.

There were 52,200 loans (worth £6.2 billion) to first-time buyers from April to June, up from 43,400 (worth £5 billion) from January to March and 85,300 home mover loans (worth £13.5 billion), up from 70,700 (worth £11.2 billion).

Credit criteria have become a little more fluid in recent months but remain tight overall, in the context of continuing business and market constraints.

10th August 2010

July bounce-back sees market recovery trend restored

The housing market experienced one of its strongest months of the year so far in July, according to the National Association of Estate Agents.

The NAEA's monthly market report found that demand for housing had increased, more sellers were putting property onto the market and the average agent made more sales than in June. The average agent in July had 292 registered house hunters, up from 279 in June.

Supply was also up, with agents reporting an average of 68 properties on their books, compared to 59 in June. The percentage of sales being made to first time buyers (FTBs) also increased from 21% to 26%, suggesting that the decision to raise the threshold of Stamp Duty Land Tax to £250,000 is translating into sales.

Michael Jones, President of the NAEA, said the market report showed that the fragile recovery that has defined the market in 2010 was continuing.

He said:

"Demand and supply both increased in July, which is great news for the housing market.

"However we should not get carried away - what we are seeing is a slow, steady and patently fragile recovery. One thing which is interesting is that consumer confidence in the market appears to be high, despite apparent uncertainty elsewhere about the future of the economy."

Mr Jones said that agents typically expected a slower month in August, as families put aside housing plans to enjoy the holiday. And he warned that lenders are still being too restrictive.

He said:

"One message that estate agents throughout the country are giving us is that the market needs more lending."

10th August 2010

Prices fall for the first time since July 2009, say RICS

The July RICS Housing Market Survey shows more surveyors are now seeing falling rather than rising prices, with the headline price balance slipping from +8 to -8, the first negative reading since July 2009.

The weaker trend in prices is being driven by increasing new vendor instructions (supply) and falling new buyer enquiries (demand). Indeed, the new instructions balance increased from +28 to +33, the highest reading since May 2007.

Anecdotal evidence from surveyors suggests the rise in new instructions is primarily related to homeowners testing the market following the abolishment of HIPs in late May, rather than due to distressed selling.

Meanwhile, the new buyer enquiries balance fell for the second consecutive month from -6 to –10. Transaction levels remained more or less unchanged with the agreed sales balance edging down from +3 to +1.

The average number of properties on surveyor's books rose by 4.1% on the month to 69.1. At the same time, the average number of sales per surveyor remained essentially flat at 16.6 (down 0.1% on the month). As a result, the sales to stock ratio – an indicator of market slack- fell to 24%, the lowest level since June 2009.

Given the amount of slack in the market, it is not surprising that price expectations turned more negative, with the balance falling from -6 to -28. Sales expectations remain positive overall, but surveyors turned less optimistic than last month, with the balance slipping from +17 to +8.

In terms the regional picture, more surveyors are still reporting price increases than decreases in London and the North West. The picture is stable in Scotland and the South West. Elsewhere, including Northern Ireland, more surveyors are seeing price falls.

4th August 2010

Former Bank of England deputy-governor, Sir John Gieve has warned that interest rates will have to rise earlier and more sharply than expected to keep inflation under control, speaking at a forum Sir John said he "would'nt be at all surprised to see interest rates at 2.5% a year from now".

4th August 2010

House prices rise by 0.6% in July, say the Halifax. Prices in July were 4.9% higher on an annual basis as measured by the average for the latest three months against the same period a year earlier. Banks are now also reporting healthy half yearly profits, are these signs of stability now returning to the market a stabilisation of the UK's recovery ??

29th July 2010

House prices up 8.4%, the June data from the Land Registry's flagship House Price Index shows an annual price increase of 8.4 per cent. This is the eigth month in a row in which the annual figure has been positive and takes the average house price to around the same levels as they were in the summer of 2006.

23rd July 2010

The UK economy grew by a faster-than-expected 1.1% in the second quarter of the year, according to official data.

The figure - a preliminary estimate from the Office for National Statistics (ONS) - was almost double the 0.6% growth rate expected by economists.

It was the fastest quarterly expansion since 2006, and marked a sharp pick-up in pace from the 0.3% growth of the first three months of the year.

Much of the growth came from the key services sector.

Within the services sector, which accounts for about three-quarters of the UK economy, business and finance posted its strongest rise in almost three years, rising by 1.3% over the quarter.

There was a big contribution from the construction industry, which grew at its fastest pace since 1963, in part because bad weather at the start of the year meant builders were catching up on work that should have taken place then.

"There are going to be some big swings in the quarterly numbers before the true pace of the recovery becomes clear”

The only sector to register a fall was transport and communications - down 0.7% on the quarter following the impact of Iceland's volcanic ash cloud in April.

The ONS said the last time the UK had growth of more 1.1% in any quarter was in 1999.

'Strong rise'

The Chancellor, George Osborne, said the figures proved his plan to cut the public sector was right.

He said: "In the Budget, I set out a plan to restore confidence in our economy by dealing with the deficit, starting this year, and to rebalance growth from the public to private sector.

"Today's figures show the private sector contributing all but 0.1% of the growth in the second quarter, and put beyond doubt that it was right to begin acting on the deficit now."

His predecessor, Alistair Darling, said the figures owed more to his government's policy. He said they vindicated the "measured and balanced" approach taken by the Labour government.

The BBC's economics editor, Stephanie Flanders, said it was always important not to read too much into one set of figures - however striking.

22nd July 2010

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20th July 2010

Gross mortgage lending in June was was an estimated £13.1 billion, a 15% increase from £11.4 billion in May and a 7% increase from £12.2 billion in June last year, according to new data from the Council of Mortgage Lenders.

14th July 2010

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9th July 2010

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8th July 2010

Base rate held at 0.5% to protect recovery

Industry pundits now believe that rates will hold steady in the short term! We've yet to see the real impact of the emergency budget, although it was well received by the markets, the recovery remains fragile and the government needs to sustain stability in the market by holding interest rates. It looks increasingly likely that low interest rates will prevail, certainly in the short term. We must ask ourselves what does "low interest rates" mean, will bank base remain at 0.5% or rise to 1.5% by the end of 2010 ? Historically a 1.5% base rate is very low, but it is three times higher than it is now. We must ask ourselves what effect this will have on mortgage payments and of course they will be higher.

8th July 2010

House prices fall by 0.6% in June, say the Halifax. The increase in houses for sale is curbing the upward pressure on prices, estate agents have reported an increase in instructions since the abolition of HIPS. Nationwide reported a slight increase of 0.1% for June. These latest figures indicate a stabilisation in house prices perhaps indicating that property values have found there true value and over the long term property values will increase in a more modest way moving away from the boom and bust cycle. It also indicates that there is now more choice in the market to give those wishing to buy better value for money. There are now signs we are nearing the point where interest rates will start to rise, so now is the time to consider fixing your mortgage payments whilst the fixed rates still remain low.

6th July 2010

Bank Rate will rise by up to 1% before 2010 is out

According to the latest Principality Building Society Saving and Spending Survey, over two-fifths (44 per cent) of people living in Wales thought that interest rates were likely to rise this year.

While 38 percent felt that rates would remain at their historic low of 0.5% into 2011.

The news follows last month's surprise seven to one vote after Monetary Policy Committee member, Andrew Sentence, called for a rise in interest rates for the fist time in over a year.

However, while Mr Sentence voted to lift rates by 0.25%, the Principality results reveal that the people of Wales are split over how far rates will rise this year, with almost a quarter expecting rates to rise by 0.5% and 24 per cent expecting a rise of as much as 1% before the year is out.

And just over a third ( 35 per cent) of borrowers in Wales, have said that they had already begun making plans to cope, should the expected interest rate rise come to fruition.

Graeme Yorston, Chief Operating Officer at Principality Building Society, said:

"The findings of our survey are mirrored by our own figures which show an increase in people choosing to take out fixed rate mortgage deals, indicating that prudent borrowers are beginning to prepare themselves for the eventualities of a rise.

"While there is growing speculation that the Monetary Policy Committee will be forced to make at least a nominal increase in interest rates in order to control increased inflation over recent months, opinion does remain split, and the confusion only serves to further dent confidence in an ever fragile market."

The Principality survey, carried out by Cardiff-based Research & Marketing and conducted among 600 people living in Cardiff, Swansea, Newport and Wrexham, revealed negative sentiment about whether now is a good time to buy property in the welsh market.

Over two-fifths (44 per cent) of people in Wales think now is a bad time to move, with the majority of people blaming difficulty in getting a mortgage (21 per cent), followed by house prices being too expensive (17 per cent) and the unstable economy (17 per cent).

As a result, over 90 per cent of people in Wales said that they did not intend to move this year.

Graeme continued:

"Low confidence in the housing market is a symptom of the wider concern about the state of the economy and indeed the austerity measures introduced through the emergency budget. Buying a home demands consumer confidence as people will want to be sure that the property will at least hold its value, and in today's market, that is a difficult call to make for the would be homeowner.

"There is no doubt that the base rate will rise - the real debate is at what point in time this will happen. In light of the inevitable movement, borrowers are wise to make preparations sooner rather than later in order to safeguard themselves for the future."

The Monetary Policy Committee, guided by the expectations surrounding consumer prices trends, will meet to decide the future direction of monetary policy this Thursday 8 July.

6th July 2010

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5th July 2010

2 year fixed rates from 2.59%

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3 year tracker rates from 2.59%

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1st July 2010

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1st July 2010

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30th June 2010

House prices rise again in June by 0.10 say the Nationwide. The month of June presented a picture of broad stability for the housing market. In the first half of 2010 average house prices have risen by 3.0%.

28th June 2010

The cost of owning and running a home in the UK has declined by 6% over the past two years, according to new research by the Halifax. Between April 2008 and April 2010 the average annual cost associated with owning and running a home fell by £544 from £9,564 to £9,020.

23rd June 2010

Bank of England vote 7 to 1 to maintain base rate at 0.5% for the 15th consecutive month