As we enter into the second half of 2020 (and what a fun year it has been…) last week we saw a lot of data on the house purchase market specifically:
House purchase market busy
Figures from HM Revenue & Customs showed house purchase transactions were down 52% on the same period last year, but up on April’s numbers.
Our own figures back that up but also show a much stronger market at the higher end that we deal with (the average price of a home in the UK is £247k, where our average is just under £1.2m).
At the start of 2020, about 35% of our business was purchases. That dropped to 6% in April, but has since recovered to 38% for June so far.
I think the next months figures from HMRC will also show that improving trend. The purchase market that we deal with (primarily London/Home Counties) seems to be very busy. From talking to our clients we are seeing people being out bid (some deals even going to sealed bids) and also having to go over asking price to secure a property. Not at all what we expected to see, but that is what is happening.
Get offer ready
If you are looking to buying, and haven’t touched base with us recently, I would urge you to do so. Getting you ‘offer ready’ is essential in such a competitive market. We can nail down the finances, and more importantly the costs, ahead of you finding a property.
When you do find somewhere, we are happy to engage with the Agent and help manage the whole process. Understandably, Agents are closely vetting their offers at present, so we can help you with that process and it really can be the difference between you securing the right property or not at present.
Money markets look to be stabilizing now. So our consistent view for a long time that we expect just more than one base rate rise in the next 5 years, seems to be the expectation now. However, I feel that is an overly pessimistic view based on people’s opinions right now, so we may well see more than that. It does look clear that rates are staying very low, for a very long time.
We saw Barclays offered it’s lowest ever 10 year fixed rate last week at 1.99%. An interesting move. Very long fixed rates have been pushed for a while in the UK but due to the penalties and lack of flexibility take up has always been low. Also, if I was cynical, I would say that lenders are now looking to cash in on that overly pessimistic view also, as locking in at that level of margin over money market rates (see above) makes it very profitable for the lender, and maybe not so much you.
In the last week:
3 Month Sterling Libor = down by 0.021% to 0.137%
2 Year SWAP = up by 0.013% to 0.214%
5 Year SWAP = down by 0.005% to 0.253%
2 Year Variable from 1.05%
2 Year Fixed Rates from 1.07%
5 Year Fixed Rates from 1.34%
BTL Rates from 1.19%
The actual rate you will be offered will be dependent on your personal circumstance and deposit level. Please speak to one of our advisers so that they can guide you through this process Source: Twenty7Tec June 2020
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Rose Capital Partners Ltd is an appointed representative of PRIMIS Mortgage Network which is authorised and regulated by the Financial Conduct Authority. Rose Capital Partners Ltd is a company registered in England and Wales with company number 08843654. The registered office address is T C Group Level 1 Devonshire House, One Mayfair Place, London, United Kingdom, W1J 8AJ
The guidance and/or advice contained in this website is subject to UK regulatory regime and is therefore restricted to consumers based in the UK
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE
The guidance and/or advice contained within this website is subject to the UK regulatory regime and is therefore targeted at consumers based in the UK. There may be a fee for mortgage advice, however the precise amount will depend on your circumstances. If a fee is charged, a typical fee is £495 . Think carefully about securing other debts against your home.