National Mortgage Index July 2018

Steady start to summer selling period

Brian Murphy, Head of Lending for Mortgage Advice Bureau comments:

“June appeared to be consistently busy in many regions, with members of the network observing a solid number of buyer enquiries, regardless of the distractions of certain major sporting events and a heatwave. In particular, Yorkshire, Scotland and the Midlands saw a very positive market, with motivated movers at all levels. However, continuing the theme of the fragmented market that we’ve seen for a few months now, other areas, such as London and the South East saw activity levels continue to tick over, but at nowhere near the levels seen in other parts of the UK.

Overall, house price growth is still positive, although the year on year increment is modest as was also reported by other major indices such as Nationwide and Halifax. Transaction volumes have also remained relatively steady over the last few months, as reported by HMRC, so whilst we’ve not seen a late ‘spring surge’ in terms of completions, one might suggest that the end of the first half of this year has seen the market perform to expectations and as such, remains in a positive position.

Feedback from our network suggests that in the current climate, those sellers who are succeeding in finding a buyer quickly are those who are most realistic, rather than ambitious, about their asking price. Even though there is still a dearth of available homes for sale in many regions, vendors who are aiming to push the boundaries of the ceiling price for the road are seeing their properties sticking, rather than finding that the law of scarcity is working in their favour as might normally be the case.

That said, there are areas where higher selling prices are still being agreed, leading to a variable picture overall. What is encouraging is that the key metrics for First Time Buyers seem to have stabilised, as our data suggests that there has been little movement in this sector between May and June with the average price of a property for those buying their first home barely changed month on month, with only a very small year on year increase. Given that First Time Buyers generally underpin the rest of the market, affordability at this end of the market is one trend that many will hope continues over the coming months.

In the remortgage sector, our data for June suggests that demand remains constant, if not increased on the same time last year, a likely consequence of ongoing news chatter around the likelihood of a rise in the Bank of England bank rate at some point this year.

In summary, we would suggest that the UK property market is entering the second half of the year in a resilient climate. Growth, whilst modest in some parts, is still evident due to buyer demand and confidence in bricks and mortar would appear to be, for many consumers at least, unruffled by ongoing political debate.”

Click here to read the full National Mortgage Index report.