National Mortgage Index October 2018

Brian Murphy, Head of Lending for Mortgage Advice Bureau comments on the National Mortgage Index October 2018.

Although the headline rate of growth in asking prices slowed slightly in September, as reported by Rightmove in their most recent House Price Index, overall purchase activity varied greatly between regions last month, meaning that there was no ‘one size fits all’ picture. Yorkshire and the Humber, Northern Ireland, Wales, Scotland and the West Midlands were all observed by RICS as seeing more positive markets than other areas of the country. Therefore, whilst average asking prices saw their slowest rate of increase for eight years last month, the more pragmatic might suggest that this still indicates growth – albeit perhaps unexceptional – and could be partly due to some motivated vendors pricing realistically in order to secure a buyer to enable a move before Christmas.   

In terms of house price growth, both the Halifax and Nationwide reported last month that figures were still in positive territory on an annualised basis, quoting year on year increases of 2.5% and 2% respectively, although again the top-level rate of growth again masks regional variations.

However, whilst demand may vary from county to county, what still appears to be evident is consumer confidence, as transaction volumes remained at steady levels, regardless of the current economic and political uncertainties.  

Lenders are still holding their rates at competitive levels; in fact, some products are now lower than they were pre-interest rate increase in August, indicating that they are very much ‘open for business’, be it for clients who wish to purchase or remortgage.  

Certainly, metrics from our lending data point to borrowing activity remaining steady over the four main groups – Residential Purchase, Residential Remortgage, Buy to Let and First Time Buyers - with only a few very modest month-on-month changes whilst the majority of key indicators remained mostly unchanged.

Therefore, whilst the news headlines may mean that some potential discretionary buyers and sellers are perhaps adopting a more cautious ‘wait and see’ approach, as we enter into the Autumn market, which is normally one of the busiest seasons of the year, there is still a healthy degree of optimism in many areas. Indeed, outside of London and the South East, in many pockets the ‘keep calm and carry on’ rhetoric appears to be prevailing, which is very encouraging.

To read the full report, click here.