MAB National Mortgage Index - November 2017

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Expected interest rate rise saw remortgage demand significantly increase in October

October saw a continuation of the mixed outlook noted in September, with some regions, such as Yorks and Humber, the North West and West Midlands, seeing prices still increase both month on month and year on year, yet the continued abating of values of other areas, most notably London and the South East.

Overall, last months’ headline data showed very little change from the previous month, however we would suggest that the better performing regions are smoothing out the overall picture where pricing is cooling slightly in some areas. With this in mind, we observed marginal monthly movements on key indicators, including:

-  Average purchase price in October 17 0.4% higher than September 17

-  Average remortgage loan size rose in October 17 to £176,186, a 1.1% increase on the previous month

-  Average first time buyer purchase price increased in October 17 to £214,132, a rise of 2.6% on the previous month

Mortgage Advice Bureau data is based upon mortgage applications therefore this provides a reliable bellwether in terms of consumer activity.

On a regional basis, topline data for the South West of England is as follows:

South West Average Statistics – November 2017 data

Purchase Mortgage

Remortgage

Average LTV %

68%

55%

Average loan size

£163,316

£151,260

Average age

36

42

Average income

£34,124

£38,095

Average property value

£239,304

£273,032

Nigel Bull from Mortgage Advice Bureau in Bristol comments:

“October was busy, with the number of clients we assisted similar to the previous month due to the number of people remortgaging as well as those who were moving home."

"In terms of those purchasing in October, we saw the normal mix of First Time Buyers together with Second Steppers and established families, although what was interesting to observe is that the balance between those buying their first home and Buy To Let landlords is changing, with less investors purchasing locally freeing up more stock for First Time Buyers. That said, serious landlords are still in the game, as they continue to see property as a viable investment due to their savings not performing."

Nigel continues: "As far as remortgages were concerned, with the anticipated interest rate rise at the beginning of November, the majority of clients we saw in October opted for five-year fixes, which are now gaining in popularity rather than the two-year deals that have been so popular up until now."

"Property values local continue to hold steady, although some of the more ambitious asking prices aren’t being achieved at the moment. What we are we are seeing now is that realistically valued properties are still selling within short timescales, due to buyer demand, but where homes are being marketed at a more aspirational price, these are taking longer to sell and will more than likely be subject to offers.”

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