Home Property Finance & InvestmentMortgages Are the clouds of property market uncertainty starting to lift?

Are the clouds of property market uncertainty starting to lift?

4th Feb 19 7:32 am

Early data coming from the mortgage space in 2019 has shown an air of positivity is returning to the UK property market, on the buyer side at least. UK Finance recorded an uplift in gross mortgage lending of 4.7% in December while the Bank of England noted a surge of £4.1bn in household borrowing in the same month.

Although early days, this makes for promising reading for a market that has suffered considerably at the hands of Brexit uncertainty over the last year particularly. Of course, mortgage lending is just the first part of a wide puzzle and it certainly doesn’t mean the market is firing on all cylinders, yet.

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However, it does demonstrate that there is still an appetite for homeownership and the market is still very much open for business despite the political turmoil. While the world is supposedly falling apart around us, there are those plucky buyers that have had enough of the consistent scaremongering being distributed by Project Fear and have decided they are going to buy a house, Brexit or no Brexit.

Why now?

Previously we’ve seen buyers sitting on their hands in an attempt to wait it out of fear they may commit, and their sound investment will see its value tumble. Despite the fact house prices are still higher than this time last year, the slower rate of growth has also seen many sellers decide to stay put in hopes that a post-Brexit world will see the value of their property once again rocket.

But months of speculation, what ifs and delays have resulted in those buyer’s hands becoming numb and I think we’ve seen a change in mentality amongst them. They’ve become less bothered about buying as an investment and are now focused on buying to create a home, which is how it should be.

Of course, this isn’t the case in the buy-to-let market and this sector remains muted after a number of setbacks courtesy of the government. However, the upshot of these professional home buyers either putting stock up for sale or refraining from snapping it up as it hits the market is an uplift in the levels of starter home stock available.

First-time buyers are benefiting as a result and this is partly driving the rejuvenated levels of buyer demand as they rarely buy with an eye on the appreciation of value, but simply to fulfil their dreams of homeownership.

In terms of our personal business, we’ve just had a record month. That’s not me showing off, however, there’s an understandable scepticism around topline figures but where the mortgage market is concerned, we’re very much seeing the change of pace and so are a number of others I’ve spoken to in the industry.

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Not only is it a good time to buy as a result of low mortgage rates, but an influx of buyers should also enable sellers to secure a slightly better price where previously they’ve refrained from a sale because the price just wasn’t right, to them anyway.

As this initial activity starts to translate through to the final stages of the market, prices should be stimulated, and we should hopefully see some stability return.

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