Market Steady in May ahead of Election

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Data from the Mortgage Advice Bureau - National Mortgage Index - June 2017

With the snap Election called in April, May was always going to be a litmus test of the UK property market in terms of how consumers would react to yet more political upheaval. However, the positive news, as can now be evidenced by the data from last month, is that most factors remained steady with very little movement in terms of key indicators, meaning that the market was positively underpinned by the time the Election took place on June 8th.

Looking at data from last month, we can observe the following:

- 1.1% increase in average purchase price, and correspondingly a 1.1% increase in typical purchase loan size
- Minimal change in the average size of remortgage month on month, highlighted by a 0.2% decrease
- Average purchase prices for First Time Buyers remained broadly unchanged on previous month with a 2.95% increase

On a regional basis, topline data for Bristol and the South West is as follows:

South West Average Statistics – May 2017 data

Purchase Mortgage

Remortgage

Average LTV %

71%

59%

Average loan size

£166,108

£155,582

Average age

37

43

Average income

£29,502

£34,862

Average property value

£238,038

£264,146

Nigel Bull from Mortgage Advice Bureau in Bristol comments:

“We saw expected levels of business in May, which were in line for the time of year and current market conditions; although of course we were aware of the upcoming Election it didn’t appear to make much difference to our clients, who seemed to adopt the ‘keep calm and carry on’ approach.

As a consequence, the majority of our clients in May were seeking mortgages to fund a home purchase, either as First Time Buyers or home movers.  Both groups were busy and active, with more properties coming to the market meaning more homes to choose from.  In particular, we observed an increase in the level of First Time Buyers who were transacting, probably because they weren’t competing with Buy-To-Let landlords for the same sorts of properties. Of course, this is a positive sign, as First Time Buyers tend to underpin the rest of the market somewhat, so this is a trend we hope to see continue.

In terms of clients remortgaging, we are still seeing more and more people who are now waking up to the face that they can reduce the amount they spend on their mortgage, either on their monthly payment or by reducing the overall term of their mortgage by remortgaging.  2 year fixed rates remain popular, particularly due to some of the ultra-competitive deals available

Property values locally are still steady, with many deals last month being agreed at or around asking price, highlighting that buyer demand is still strong and the local market remains consistent.” 

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