29 May 2020
Mortgage market starts to return to ‘normal’
As lockdown starts to ease, we are also seeing welcome improvements in the residential and buy-to-let mortgage markets.
According to Zoopla, an estimated 373,000 sales were suspended during lockdown. This, in turn, led to a sharp fall in people seeking a new mortgage. With restrictions loosening on estate agents and valuers and the market picking up again, lenders – who have plenty of liquidity and are keen to lend – are competing hard for their share of the market by offering some fantastic deals.
Fixed rates have fallen yet again, from an already historically low level, on the back of declining Swap rates. Those borrowers who are fortunate enough to have a large deposit and are looking to borrow up to 60 per cent loan-to-value (LTV) can choose from a range of fixed rates starting from below 1.5 per cent. But at the higher end of the LTV curve there is also some good news as we are seeing the return of lending at 90 per cent LTV as physical valuations are allowed once more. Clydesdale Bank, Virgin Money and Accord Mortgages are among those who have returned to lending at this level. This will help first-time buyers in particular who tend to have smaller deposits.
One of the consequences of lockdown and lenders having to divert resources to deal with mortgage payment holidays, the closure of call centres and staff working from home for the first time, has meant restrictions imposed on lending and delays in getting things done. But restrictions on loan sizes and property values, also put in place in response to the ban on physical valuations are being lifted, and the market feels as though it is getting back to ‘normal’. Estate agents report new listings as those sellers who may have been delayed by Brexit negotiations and now coronavirus, want to get on and move.
At SPF Private Clients we know each lender’s criteria inside out and are abreast of the mortgage market whenever changes and updates occur. We will know which lenders to approach in order to secure the most suitable and cost-effective mortgage for your individual circumstances.
Should you have any questions, or indeed would like to have a chat about the market in general, please do not hesitate to get in touch with us.