In the current market climate it is a good idea to review your mortgage arrangements.
“So, now is an ideal time for brokers to contact their clients and make sure that they have the best possible deal as this could be a once in a lifetime opportunity to lock into the lowest ever mortgage rates, ” Andy Knee (left), from LMS said, commenting on the latest lending activity figures from the CML.
Both, the first-time buyer and the remortgaging sector have experienced a drop in lending activity towards the end of last year. Apart from seasonal changes, the cool down stems from various factors influencing the property market. However, things are looking up for 2015.
Knee, who is the chief executive of outsourced property services provider LMS, comments:
“The industry-wide month-on-month decline in lending to first-time buyers, home movers and remortgagors is an unambiguous sign of a seasonal cooling of the market towards the end of the year. While the market pauses for breath, however, it is important not to ignore the 3% fall in year-on-year lending to first-time buyers, which is further evidence of the impact of stricter lending criteria and tougher regulations on those who continue to be locked out of the market. There are expectations that with almost nine months’ worth of understanding of the MMR, the market will work more benevolently in 2015, enabling lenders to lend to those currently unable to acquire finance for their homes.
“Remortgaging follows similar patterns, and while it’s easy to attribute the month-on-month fall to seasonality, remortgaging is down by 16% from November of last year, which may be attributed to a number of factors: general market perceptions that acquiring a mortgage has become tougher after April and expectations that interest rates are set to remain low until a more robust economic recovery is established. Looking at the lender perspective, with MMR now bedded in, they are keen to increase business levels in 2015 and with the purchase market falling back, many lenders are providing an added emphasis to their remortgage offering.”
Lending to first-time buyers last November fell 11 per cent on the month and 3 per cent on the year. Remortgaging saw an 8 per cent fall on October and a 16 per cent decline compared to a year ago. Total house purchase lending in the UK was down by 12 per cent on a monthly and by 7 per cent on an annual basis.
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