Docklands News

More than one in 10 borrowers in Britain, around 1.6m, are locked into five-year fixed mortgages taken out during the pandemic property boom, meaning they could escape the mortgage crisis unscathed. They are not due to refinance until 2025 or after, when analysts now expect interest rates will have reverted to far more manageable levels. Analysis shows that more than 75,000 borrowers are also signed up to fixed interest periods of more than five years. In addition, more than half of homeowners in Britain do not have a mortgage, which provides another layer of protection for the housing market from distressed sales caused by high borrowing costs. David Hollingworth, associate director at L&C Mortgages, said: “The rates have shot up because there is something of a lag period. The big benefit of that is as rates have risen rapidly many [borrowers] have been protected from those increases. There's a lot who will be coming towards the end of their fixed rate. The most unfortunate ones would have already come to that point and had to refinance".

The Daily Telegraph (10/01/2024)  

Banks are set to cut mortgage rates to their lowest levels since 2022, as strong competition between lenders drives down the cost of home loans. The Co-op Bank will release a two-year fixed-rate deal at 3.85%, the first below 4% in 15 months. Other big lenders, including Barclays and Nationwide Building Society, are expected to follow suit. The financial data analyst Moneyfacts said the average rate on a two-year fix had fallen from 6.04% at the start of last month to 5.83% on Friday, and the average five-year fix from 5.65% to 5.46%. David Hollingworth, from the broker L&C Mortgages, said the lower rates "should help lift some of the new year blues for borrowers coming off their existing deals". About 1.6m homeowners are due to come off their existing fixed deals this year, according to the trade association UK Finance. 

The Times (08/01/2024)  

Jeremy Hunt has admitted that buying a first home in Britain today is a "real struggle" after Sir Howard Davies claimed it was "not that difficult". The boss of NatWest said that people would "have to save more" but suggested the system had simply reverted to how it "used" to be. Housing campaigners criticised his claim while shadow chancellor Rachel Reeves branded Sir Howard "out of touch". When asked about the comment, the Chancellor referenced the much higher mortgage rates compared to 18 months ago. He said: "We know that makes it a real struggle for people trying to buy their first home." He insisted the way to deal with the problem was to continue to focus on cutting inflation.

The Independent (06/01/2024)  

The National Association of Property Buyers says that only one London neighbourhood will see its residential properties rise in value this year. It says that Rotherhithe is set to benefit from the high demand for living space in the area compared to the "low-key" plans for building houses in the area creating a shortage and so driving up prices. Rotherhithe benefits from parks such as Stave Hill Ecological Park, which overlooks the Canary Wharf skyline; it is also well connected to the rest of the capital, with an Overground station, and a Jubilee line stop at Canada Water. 

My London (02/01/2024)  

UK house prices fell 1.8% over the course of 2023, according to Nationwide’s House Price Index. Month-on-month, prices were flat compared to November at an average of £257,443. Nationwide said consumer confidence "remains weak", despite some mortgage rates starting to fall, while also noting that the number of housing transactions has been running at around 10% below pre-pandemic levels. The lender’s report suggests there are “encouraging signs” emerging for potential buyers, with expectations pointing to moderate inflation and interest rates. However, Robert Gardner, Nationwide’s chief economist, said a “rapid rebound in activity or house prices in 2024 appears unlikely.” "If the economy remains sluggish and mortgage rates moderate only gradually, as we expect, house prices are likely to record another small decline or remain broadly flat (perhaps 0 to -2%) over the course of 2024," he added. 

City AM (29/12/2023)   Financial Times (29/12/2023)   The Guardian (29/12/2023)   The Times (29/12/2023)  

The number of homes sold to first-time buyers in the UK has been steadily increasing for almost a decade, with 28% of properties sold to them this year. Despite challenging market conditions, first-time buyers have shown resilience and have even outnumbered experienced movers in 28 local authorities, particularly in London and surrounding areas. A survey by the Skipton Group revealed that 70% of first-time buyers are willing to make compromises, with the size of the garden being the top compromise. The research also highlighted that first-time buyers in London are more likely to receive financial support from their parents for their deposit. The average household income of first-time buyers has increased by 14%, indicating their increased buying power. 

The Express (30/12/2023)   The Sun (30/12/2023)