Catch up on Mortgage Strategy’s most popular stories this week. Sub-5% mortgages may return ‘in weeks’ and House prices suffer the largest fall in 14 years. Read more below:
Sub-5% mortgages may return ‘in weeks’: Rightmove
According to Rightmove, sub-5% mortgage rates could potentially return to the market in the “next few weeks” due to the easing of swap rates and market speculation that the Bank of England’s cycle of interest rate hikes may be nearing its conclusion. Currently, the average two-year fixed mortgage rate stands at 6.24%, which is 4 basis points lower than the previous week, as reported by the property website.
House prices suffer largest fall in 14 years: Halifax
In August, average house prices experienced a notable 4.6% year-on-year decline, marking the most significant annual drop since 2009, as indicated by data from Halifax. This decrease is attributed to the impact of “higher mortgage costs on house prices.” On a monthly basis, prices also declined by 1.9% last month, reaching £279,569. This represents the fifth consecutive monthly decrease and the most substantial monthly decline since November of the previous year, according to the latest House Price Index from the lender.
‘Just give us notice’ brokers urge lenders
Research conducted by Castle Trust Bank reveals that a significant majority of brokers, specifically three-quarters, express their unwillingness to engage with a lender that abruptly withdraws its products. Furthermore, over 60% of brokers indicate that they would be less inclined to use a lender if they perceived the notice period for product withdrawals as unreasonable, and nearly 16% stated that product withdrawals would consistently influence their decision-making process.
Rents set to rise almost five times faster than house prices by 2026: Hamptons
According to a forecast by Hamptons, rental prices are projected to increase nearly five times faster than house prices in the next four years. The estate agency predicts a 25% rise in rents by 2026, in contrast to a 5.5% growth in property prices throughout Great Britain.
Hundreds of misleading later life ads corrected after FCA review
As a result of a review conducted by the Financial Conduct Authority, nearly 400 deceptive promotions from later life mortgage firms had to be either withdrawn or modified. The study by the City watchdog focused on firms responsible for approximately half of all lifetime mortgage sales and revealed that, in numerous instances, the advice provided did not meet the expected standards.
Annual house prices fall for first time in 11 years: E.surv
In August, home prices in England and Wales fell 1.3% year-on-year to £369,127, marking the first annual decline in over 11 years, according to e.surv data. This drop of £4,800 is the first since March 2012 when the housing market was recovering from the banking credit crisis of 2007-2010.
House prices fall at fastest rate in 14 years: RICS
In August, house prices experienced their most significant decline in 14 years, as reported by the Royal Institute of Chartered Surveyors (RICS). This downturn coincided with a decrease in both buyer demand and sales, with experts cautioning that improvements are unlikely in the near future.
Italy taxes banks to help mortgagees – should UK follow suit?
In early August, the Italian government passed a 40% windfall tax on banks, directing the proceeds toward assisting distressed mortgage holders. Italy joins other countries in implementing such a measure; for instance, the Spanish government adopted a similar scheme in November 2022. The key question remains: could a bank levy be effective in the UK?
Nationwide further reduces rates
Nationwide Building Society is lowering rates on specific fixed mortgage products by as much as 0.29%. These updated rates will take effect starting September 13. For new customers in the process of relocating, reductions of up to 0.29% are available on the society’s two and three-year fixed products, up to a 95% loan-to-value (LTV) ratio.
The Mortgage Works brings sub-5% BTL loans to market
The Mortgage Works is among the first major lenders to introduce sub-5% home loans — and has also cut rates by up to 50 basis points across selected new business products.
