Docklands News

Rishi Sunak’s mortgage guarantee scheme has been used by just nine first-time buyers a day. When the Chancellor first unveiled state-backed 5% deposit mortgages in March, they were hailed as a life-line for potential first-time buyers struggling to save a deposit. However, figures have revealed that take-up has been slow. Between mid-April and the end of June just 812 mortgages completed using the support scheme, equal to 0.7% of all residential mortgage completions, according to figures published by the Treasury. Of the borrowers who used the scheme, only 666 were first-time buyers. Neal Hudson of Built Place, an analyst, said: "The numbers are definitely very low. There will, however, inevitably be a delay because borrowers using the scheme will have had to do so in the early stages of their buying process." 

The Daily Telegraph (03/12/2021)  

First-time buyers have the opportunity to get on to the property ladder at a new neighbourhood in East London. L&Q’s new homes offer some of the first opportunities to buy at Barking Riverside, a community the size of Hyde Park that will eventually host over 10,000 homes, along with commercial and leisure space, public spaces and riverside walks. Claire Brenlund, sales and marketing director at L&Q commented: “Barking Riverside is drawing a fantastic amount of attention from first-time buyers across the capital thanks to the extraordinary facilities it promises, paired with its affordability. Buyers who move to Barking Riverside will get to witness some of the project’s most exciting milestones opening soon, including the launch of Barking Riverside’s London Overground station.”

BDaily (02/12/2021)  

House prices continued to rise in November, despite predictions that the market boom that began last summer would cool off over winter following the end of the stamp duty holiday. Nationwide’s latest house price index revealed that prices rose 0.9% last month with annual growth creeping back into double figures. The 10% year-on-year increase marked an acceleration from October, the first month that wasn’t boosted by the stamp duty holiday, when month-on-month growth was 0.7% and the annual rate grew 9.9%. The average price of a home in Britain now stands at £252,687, according to Nationwide. Prices have risen by more than £33,000, or 15%, since the pandemic started last March. There have already been more housing transactions this year than in 2020 with a month still to go and activity levels are close to those seen in 2007 before the global financial crisis rocked the property market. However, Nationwide's chief economist, Robert Gardner, warned there could be trouble ahead for the market, citing the Omicron variant and falling consumer confidence. Rising interest rates may also exert a "cooling influence", he said. 

Financial Times (01/12/2021)   The Daily Telegraph (01/12/2021)   The Guardian (01/12/2021)   The Times (01/12/2021)  

A First Time Buyer Index surveying 2,015 prospective and 500 actual first-time buyers (FTBs) has revealed that over half (58%) needed to raise a larger deposit than initially intended due to the impact of the COVID-19 pandemic. The average increase was an additional £22,849, bringing the deposit size up to £62,572 (an average of 18.6% of the property value). According to the survey by Aldermore, it took first-time buyers an average of 4.6 years to save up enough to buy a home. Two in five (40%) FTBs took two or more offers to secure the home they bought, stretching out the process and raising costs. Before that, half (49%) were in the process of buying a different property only to have it fall through. This cost new buyers an average of £2,403. Increased challenges and multiple attempts at buying meant first-time buyers faced a delay of an average of three months. These extra barriers and costs meant that 48% felt they did not get the home they wanted because they had to compromise so much to get on the housing ladder. 

Daily Express (27/11/2021)  

Mortgage deals for first-time buyers are now cheaper than before the pandemic. Younger buyers with small deposits were largely locked out of the market last year as lenders pushed up prices for riskier borrowers. But lenders are now competing for their business to hit their annual targets. Mark Harris, of the mortgage broker SPF Private Clients, said: "Greater competition, in what is still an underserved segment of the market, has forced down pricing on small deposit mortgages." The average two-year fixed-rate mortgage with a 5% deposit is now 3.13%, according to Moneyfacts, down from November last year, when it was 4.74%, and lower than the 3.27% it was in the same month in 2019. It is also the case for longer deals. A five-year fix for first-time buyers with a 5% deposit charges 3.41% on average, lower than the 4.21% in 2019. 

The Daily Telegraph (27/11/2021)  

The Financial Conduct Authority (FCA) has urged banks and building societies to consider changing lending criteria to help an estimated 47,000 borrowers who could benefit from a cheaper mortgage but are currently unable to move. The watchdog’s review of mortgage prisoners found that about 195,000 households have had debts sold on to inactive lenders, with it shown that a quarter of these could save money if they were allowed to switch to a new deal. The review, which looked at the position of borrowers whose loans were sold on to new lenders after the financial crisis, found that about 47% were paying an interest rate between 3% and 5%, compared to 17% of borrowers with active lenders, while 3.3% were locked into paying interest at more than 5%, compared with just 0.8% of other borrowers. 

The Guardian (29/11/2021)