mortgages
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Latest property news
HSBC quits CML
The HSBC has said that it will leave the CML by the end of 2016 as industry trade bodies get set to merge – and Barclays could follow. The bank has handed in its notice that it intends to leave the CML at the end of December – having served the requisite one year notice period. HSBC’s decision also comes after plans were unveiled in November to merge the CML with the banking industry’s other trade bodies; the British Bankers’ Association (BBA), Payments UK, the UK Cards Association and the Asset Based Finance Association. A spokesperson for HSBC said, “Given the anticipated creation of a new financial services trade association, we have given one year’s notice to the Council of Mortgage Lenders and our membership will end on 31 December 2016. HSBC supports the creation of a new trade association which will better serve all providers in the financial services sector and most importantly, our customers. We have and continue to value our work with the CML and believe a strong mortgage voice is critical within any new association.” Speculation is growing that Barclays may also hand in its notice to leave the CML. A Barclays spokesman commented, “We can…
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Latest property news
Mortgage lending at seven-year high
Gross mortgage lending rose by eight per cent in 2015, taking the estimated total for the year to £220.3 billion compared with £203.3 billion in 2014, according to the Council of Mortgage Lenders (CML). The CML estimates reveal that gross mortgage lending hit £19.9 billion in December, three per cent below November’s lending total of £20.5 billion, but 23 per cent higher year-on-year at £16.2 billion. Gross mortgage lending for the fourth quarter was therefore an estimated £62.3 billion, up 23 per cent on the corresponding period in 2014. “The low inflation environment, along with real wage growth, an improving labour market and competitive mortgage deals have all helped to underpin demand,” said CML Economist Mohammad Jamel. Looking ahead though, he said the upside potential looks limited over the near-term. He added, “The supply of existing and new properties on the market remains weak and affordability pressures weigh on activity. There is an added element of uncertainty as we wait to see the impact of tax changes on the buy-to-let sector.”
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Latest property news
Property franchises broaden their horizons
The Property Franchise Group has teamed up with Legal & General and London & Country to offer their customers mortgages across the whole of the market. The Property Franchise Group, the UK’s largest property franchisor with 287 offices nationwide trading under various brand names including Martin & Co, Whitegates, CJ Hole, Parkers and Ellis & Co, hope that the new financial services arm will help to significantly boost company profits. London & Country, the UK’s largest fee free mortgage broker with a 3 per cent market share, expect to arrange in the region of £9 billion worth of mortgages and process 43,000 applications this year, of which 20 per cent are buy-to-let. Phillip Cartwright, Managing Director of London & Country, commented, “Our partnership with The Property Franchise Group is mutually beneficial and we are delighted to be associated with the UK’s largest property franchisor. They have one of the biggest client bases in the sector and we are looking forward to helping their customers take advantage of our award winning, fee free service.” The new financial service offered by The Property Franchise Group will be available via telephone and online. “We chose telephone and web fulfilment because people are busy…
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Latest property news
Mortgage lending hits 7-year high
Mortgage lending has surged to its highest level since 2008 as borrowers rush to take advantage of highly competitive home loan deals. Fresh data provided by the Council of Mortgage Lenders (CML) shows that lenders advanced a total of £21.8 billion last month, up 19 per cent on the £18.4 billion lent a year earlier and 8 per cent on September’s total of £20.1 billion. October’s lending total is the highest since July 2008, when lenders advanced £23.6 billion. The CML said total mortgage lending across 2015 looks likely to top its previous estimate of £209 billion as mortgage lenders continue to compete for business by keeping borrowing rates low. Separate figures from MoneySuperMarket revealed that the average two-year fixed-rate mortgage rate fell to 2.68 per cent in October, from 2.72 per cent in September, while the typical three-year fixed rate on offer dropped from 3.1 per cent in September to 3.08 per cent in October. Bob Pannell (left), the CML’s Chief Economist, commented, “As lending in the regulated mortgage space picked up over the summer months, the pace of recovery has improved. This looks set to continue over the closing months of the year with the factors helping support…
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Housing Market
Cash buyers account for one-third of property transactions
The number of people paying in cash for properties in England and Wales has increased, according to new analysis published by the Council of Mortgage Lenders (CML). The total volume of cash buyers rose to around one-third of transactions, fuelled largely by older purchasers who are selling off their large homes for significantly more money than they paid for them. In turn, they are acquiring smaller units with cash, leaving them mortgage-free. The research by CML shows that in the region of three-quarters of cash purchases were funded by the sale of another property. Most of the rest are paid for from savings or an inheritance. Cash buying increased across many parts of England and Wales, with the average value of a cash transaction almost identical to one funded by a mortgage. The largest proportion of purchases funded by cash is in the South West, while the smallest proportion is in London, reflecting the fact that property prices in the capital are significantly higher than the national average. London and the South West were the only parts of the country where the average property acquired for cash is more expensive than one funded by a mortgage. Within the capital, there…
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Latest property news
600,000 homeowners to use pensions to pay off mortgage
Over half a million people in the UK intend to use their retirement savings to pay off their mortgage by using either the tax-free 25 per cent lump sum or the entire pension pot, according to specialist insurer Partnership. A survey of 3,000 found one in ten 40 to 70-year-olds – the equivalent of 631,000 adults – plan to use all or part of their pension to help pay down their mortgage debt. Andrew Megson, of Partnership, said that it was concerning that so many people are relying on their pension to pay off their home loan. He commented, “Using their pension may well seem like an option but it is not the only option as working longer, downsizing or considering a lifetime mortgage may be more appropriate.” “Ideally, pension savings should be used to provide an income in retirement, and with the state pension only providing a very basic safety net, making this choice could lead to hardship in later life,” Megson added. Separate figures from the Association of British Insurers (ABI) reveal that pension savers have been withdrawing £27 million a day since the pension freedoms were introduced in April, latest figures from the Association of British Insurers…
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Housing Market
Mortgage approvals surge
There was a significant rise in the volume of mortgage deals secured in the first half of August, with early indications suggesting that this could be a record month for mortgage approvals. With property buyers and existing homeowners not wanting to miss out on record low mortgage borrowing rates, conveyancing firm QCAS has suggested that we could see record transactions this month following a sharp increase in the number of mortgage deals for August so far – already the highest since 2010. Victoria Mortimer, Head of QCAS, the conveyancing division of corporate law firm Shulmans LLP, said, “Normally transactions are low in August due to holidays, but we’ve got more work on than ever compared with the same time in previous years. As a national, large scale conveyancer we are well placed to spot emerging trends and there’s no doubt about this one. People are getting their finances sorted before the end of the year.” Mortimer described activity levels over the past 12 months as “incredible”, with her firm having handled more than £3 billion worth of property transactions during that time. “We believe this is due to a combination of factors; there are some great deals out there at…
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Housing Market
Repossessions fall to historic low
Repossessions in the UK dropped to the lowest level since records began in 2008 during the second quarter of 2015, the latest data shows. The figures from the Council of Mortgage Lenders (CML) reveals that the repossession rate in the last quarter was just 0.02 per cent, which is equivalent to just one in 5,000 mortgages and the data from the CML revealed that arrears also continued to drop. Record low interest rates were a major factor in helping homeowners stay on top of their mortgage payments in the second quarter of the year, along with falling unemployment and a strengthening domestic economy. In total, there were 2,500 properties taken into possession in the second quarter, down from 3,000 the previous quarter and 5,400 in the second quarter of 2014. Of these, 1,800 were in the owner-occupier market and 700 in the buy-to-let market. In terms of arrears, the total number of mortgages with arrears equivalent to 2.5 per cent or more of the mortgage balance was 106,400, or 0.96 per cent of all mortgages, which again, was the lowest rate since quarterly records began seven years ago. Of all loans with arrears of over 2.5 per cent of balance,…
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Housing Market
First-time buyers make up nearly half of all mortgages
First-time buyers in this country now account for almost half of all homes purchased with a mortgage, a rise of 38 per cent since 2011, owed in part to a surge in first-time buyer mortgage deals, new research shows. The study from the Halifax revealed that first-time buyers make up 47 per cent of all mortgage-aided acquisitions, while the deposit that they have to pay has increased by 6 per cent over the past 12 months to an average of £29,894, reflecting a general rise in property prices over the past year. The average first-time deposit is now 82 per cent or £13,494 higher than in 2007. Overall there were an estimated 139,500 first-time buyers in the first six months of this year, down 7 per cent year-on-year, but while this is the first annual decrease on this basis since the first half of 2011, it is still the highest total for the first six months of the year since 2007. Craig McKinlay (left), Halifax Mortgages Director, said, “There was a modest decline in the number of first time buyers in the first half of the year following the substantial increases recorded in 2013 and 2014. This fall has been…
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Features
Conveyancing: How to stop fall throughs
Conveyancing delays frustrate sellers and worry buyers, Sheila Manchester looks at efforts to improve the process.
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