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More accessible lending for first time buyers in UK confirmed by latest data
There has been an increase in the UK to borrowers with smaller home deposits due to increased accessibility in lending and highly attractive mortgage rates, the latest mortgage market report suggests. Loans to borrowers with small deposits, typically first time buyers, saw a year on year increase in April of 7.3% and were up 6.4% month on month, according to the data from e.surv chartered surveyors. However, the number of house purchase approvals fell year on year, suggesting that higher LTV lending is helping to support total mortgage approval figures. In the total market, there were 1.9% fewer approvals for house purchase loans in April than there were last year: 62,035 loans, down from 63,236 in April 2014. As a proportion of total approvals, higher LTV lending now stands at 16.3%, compared to 15.5% in March and 14.9% in April last year. These gains come despite a poor start to the year, the report points out. ‘This revival of the bottom of the market is becoming ever more crucial and this showed in the recent election struggle, with all the main parties placing helping first time-buyers as one of the crucial components of their campaigns,’ said Richard Sexton, director of e.surv. ‘However, before concerns are raised regarding the increase in higher LTV lending, it’s worth putting these numbers in context. The number of higher LTV house purchase approvals is still only a quarter of what it was in 2007. This is a healthy upturn in higher LTV lending, not a symptom of any malady in the mortgage market,’ he explained. ‘Prime Minister David Cameron has outlined a plan to provide 200,000 cut price starter homes, alongside a commitment to unlocking brownfield land for building new homes. This is the kind of clear planning the property market needs and it is to be hoped that the proposals crystallise into real policies,’ he added. The data also shows that on a monthly basis, house purchase approvals increased 1.1% from March, when there were 61,341 house purchase loan approvals. Despite a small month on month drop in March, this is the latest piece of a clear trend of growth stretching back to December last year. Sexton pointed out that in the wake of mortgage reforms a year ago there were five consecutive months of dips. ‘We turned a corner at the start of this year, and lending is starting to find its feet again in the new regulatory landscape. This should be even more of a spur to the government to push forward their plans for home building, as a continual demand for home ownership places ever more pressure on Britain’s insufficient stock of homes,’ he said. The proportion of higher LTV lending has either increased or remained stable in most UK regions in April but Scotland saw just 12% of house purchase approvals for borrowers with smaller deposits in April, compared to 16% in March. At the other end of the spectrum, house… Continue reading
Finding the right property often relies on gut instinct, survey finds
When looking for a new home many people have a gut feeling about whether or not they can see themselves living in a particular property, a new survey has found. Continue reading
Record December for house prices in Scotland
Scottish house prices have increased by £6,700 in the last 12 months to hit a six year high, nearing the pre-recession peak, the latest index report shows. Prices in December increased by 0.3% and year on year price growth is up 4.2%, taking the average house price to £165,075, according to the Your Move Scotland house price index. Total home sales in 2014 were 11% higher than 2013, led by the first time buyer market and despite falling oil prices property values in Aberdeen have seen some of the strongest annual growth, up 10%. Indeed, average house prices in Aberdeenshire and the Shetland Islands both reached new records in December, while overall Scottish house prices reached a crescendo at the end of 2014, ending on a high note with an all-time record December. ‘After the brief unsteadying influence of the independence referendum, house price growth has firmly fallen back into a steady rhythm, and values climbed 0.3% in December,’ said Christine Campbell, regional managing director of Your Move. She pointed out that values have risen 4.2% or £6,688 in a year, taking them to the highest level seen since June 2008. Standing at £165,075 in December, this means the average house price in Scotland is now just £440 shy of the pre-recession peak, and households across the country are beginning to taste the fruits of the economic revival. ‘Speculation has been running wild as to the effect of plummeting oil prices on Aberdeen’s housing market. However, the city actually witnessed the biggest annual jump in house prices on mainland Scotland, up 10% in the past 12 months, equivalent to £20,438,’ explained Campbell. ‘Aberdeen is also holding its ground as one of the most expensive places to buy, and during December the city recorded the highest price paid for a property in Scotland throughout the whole of 2014, at £3million,’ she pointed out. ‘Growth is making its way beyond these urban economic centres though, and the Shetland Islands joins Aberdeenshire in setting a new record house price in December. Stronger activity at the bottom rungs of the ladder has pushed the average price for a terraced home in the Shetland Islands up from £106,000 in the fourth quarter of 2013 to £156,000 in the fourth quarter of 2014,’ she added. Demand from first time buyers means that at the lower end for affordable starter homes sector flats have become the most frequently purchased type of property in Scotland. Sales of flats between July and December 2014 have seen a 6% rise on the same period a year previously. Argyll and Bute saw the biggest year on year increase in transactions during the second half of the year, with flats sales up 28%. The data shows that overall, the total number of home sales in Scotland during 2014 was 11% up on 2013 but the majority of that progress was made in the busier first six months of the year, showing an increase of… Continue reading
