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Mortgage market review December 2016

Part 2

Mortgage market update for December 2016, Part 2

Macro news and drivers
Surveyors warn housing market faces slow start to 2017
The number of prospective buyers in the UK housing market has increased for the third consecutive month, according to the Rics Residential Market Survey. The survey of chartered surveyors showed 13 per cent reported an increase in new buyer enquiries rather than a fall.   
House prices bump up in November
House prices nudged up slightly in November after flat-lining during the previous month, according to figures from Nationwide. The building society's monthly annual house price index showed UK house prices had bumped up 0.1 per cent in November, after making no movement in October.  
London house price growth beaten by commuter towns
House price growth in 10 commuter towns has outstripped the capital over the past year, according to buying agents Garrington Property Finders. While Land Registry data shows the average price of London property rose by 11 percent in the 12 months to September, house price growth in Brentwood and Canterbury was 16 percent.   
Bank of England downplays low interest rate savings concerns
Bank of England monetary policy committee member Gertjan Vlieghe has hit back at criticism that low interest rates are hitting savers because most UK wealth is held in property rather than bank deposits.   

Regulation and legislation

Hammond sets his housing policy
Chancellor Phillip Hammond touched lightly on housing and housebuilders, without throwing a crumb of comfort in the form of stamp duty reductions, in his Autumn Statement. Some viewed the Autumn Statement was a "missed opportunity" to help home-movers.   
Lenders 'breaking MMR rules' over non-advised sales
Lenders' product transfer sales tactics break Mortgage Market Review rules around non-advised sales and should be reviewed by the FCA, according to industry experts.   

Product developments and innovation

HSBC scraps its 0.99% two-year fixed rate mortgage
HSBC has scrapped its 0.99% two-year fixed interest rate after six months, suggesting that the recent period of record low fees could be coming to an end.   
Coventry offers lowest ever fixed rate mortgage
Coventry for Intermediaries has launched is lowest ever two-year fixed rate mortgage at 1.29%. For a loan-to-value (LTV) of 50 per cent it will offer a 1.29 per cent rate for residential mortgages for two years with a £999 fee.   
Accord scraps processing fee for landlords
Accord Buy-to-Let has reduced rates on fixed rate deals and scrapped the processing fee on all applications for landlords. Highlights include a two-year fix, which is now available at 1.59 per cent to 60 per cent loan-to-value (LTV) for remortgaging landlords and those looking to expand their portfolio.   
Clydesdale increases LTV for larger mortgage loans
Clydesdale has raised the loan-to-value for capital and interest mortgages to 80 per cent for a maximum loan size of £1.5m, regardless of geography. It is also now offering loans which contain an interest-only element beyond London to other areas of the south east.   
Accord launches online hub for mortgage brokers
Accord has launched an interactive website to help mortgage brokers explain new products to clients. The online toolkit from the intermediary-only lender, part of the Yorkshire Building Society, offers mortgage calculators, a guide to the application process and simple explanations of the types of mortgages available plus the benefits of different products on the market.   
Leeds shakes up buy-to-let lending criteria
Leeds Building Society has announced new criteria following the Prudential Regulation Authority's changes to underwriting standards for buy-to-let mortgages. Chief commercial officer at the firm, Richard Fearon, has described Leeds Building Society's criteria as bringing a "unique proposition" to the buy-to-let market.   
Newcastle enters Help to Buy market
Newcastle Intermediaries has entered the Help to Buy new build market. The lender's deals will include both the standard 20 per cent equity loan and 40 per cent in London (Help to Buy London).   

Consumer trends 

Britain's wealthiest denied credit
Britain's high-net-worth individuals are routinely being turned down for credit cards, loans and mortgages, according to research. A million of the UK's richest people have been unable to secure overdrafts and loans, despite having personal assets worth more than the loan they seek, according to a survey by Market Financial Solutions, a London-based bridging lending provider.   
Londoners have to fork out 14 times their salary to buy a home
The disparity between average earnings and house prices is reaching record levels in certain parts of the country.  

Experts corner

Property prospects post-Brexit
Following the referendum, buyers and sellers paused to see whether job security and/or access to competitively priced mortgages were likely to change. There is no doubt most are taking longer to commit and negotiating harder so some property prices have softened.   
Autumn Statement: what impact will the government's affordable homes push have?
While the Chancellor's Autumn Statement has been welcomed by many in the property industry, question marks remain as to whether it will actually have much impact on home ownership.

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