House prices up again in June
Mortgage Introducer Magazine 1 July 2013; Ryan Fowler.
House prices increased by 0.4% in June, matching the growth in May which was the highest increase in a single month since June 2007, the latest Hometrack Monthly National House Price Survey has revealed.
Hometrack said the momentum in house price growth over the first half of the year has been driven by a widening imbalance between supply and demand. The gap stabilised in June with slower growth in demand (up 1.6%). A seasonal slowdown in demand is to be expected as we approach the summer.
Richard Donnell, director of research at Hometrack, said: “The recent momentum in house prices continued into June with house prices growing 0.4% over the month. This increase matches May 2013 as the highest rise in prices in a single month since June 2007. An on-going shortage of housing for sale, continued growth in demand and improving market sentiment are combining to push prices higher.”
On a regional basis prices grew across 31% of postcodes in June – this is the highest level since September 2007.
Prices fell in just 3.1% of postcodes, the lowest level for 3 years (June 2010).
London registered the strongest growth in June with prices rising by 0.9% for the second month in a row. While market conditions have improved house prices remained unchanged in four out of ten regions.
Donnell said: “There is a clear divide in market performance between London and Southern England and the rest of the country. While underlying market conditions have improved across all regions, house prices were unchanged in four out of ten regions in June. The upward momentum seen in house prices has been driven by a widening gap between supply and demand.”
Looking ahead Hometrack said it expects prices to increase, though at a slower rate, as we move into the summer months.
BOE: Mortgage approvals hit three-year high
Mortgage Introducer Magazine 1 July 2013; Author: Ryan Fowler.
British mortgage approvals hit a three and a half year high in May, Bank of England data has revealed.
Mortgage approvals numbered 58,242 in May, the highest reported figure since December 2009, and were up from 54,354 in April.
Mark Harris, chief executive of mortgage broker SPF Private Clients, said: “Mortgage approvals continue to improve, both for new purchases and remortgages. This is entirely what you would expect given the plethora of rock-bottom mortgage rates now available. Despite some erratic movements from Swap rates in the past week, mortgage rates are likely to stay low for some time yet.”
Harris said he also expects criteria to continue to loosen as lenders look at ways to attract borrowers other than simply undercutting each other on rate.
Harris said: “While the numbers continue to rise, they are still well below what they were at the peak of the market before the crisis. The health of the housing sector is showing a slow and steady improvement but it is by no means out of intensive care just yet. Still, the indicators are good and government schemes such as Help to Buy will continue to provide much-needed assistance, particularly for struggling first-time buyers.”
The data also revealed that credit flow to businesses continued to fall. Lending to non-financial businesses fell by a net £1.27b in May as lending to smaller firms dropped by £452m.
Gross remortgage lending up £576 million in May
Source: What Mortgage Magazine, 25th, June, 2013; Author: Rebekah Commane.
In May remortgage lending rose to £3.9 billion, up 17.1 per cent on April’s £3.4 billion, according to figures from LMS Property Services. Figures reveal that monthly gross remortgage lending increased by £576 million in May to £3.9 billion. This is up 17.1 per cent on April’s £3.4 billion reported by the Council for Mortgage Lenders (CML) last week.
The CML has also reported that total gross mortgage lending rose 20.8 per cent in May to £14.7 billion, from £12.2 billion in April. As a result, remortgages now represent 27 per cent of the market.
LMS estimates that the total number of remortgage loans in May increased by 12.7 per cent to 27,087 compared with 24,041 in April. This figure, however, is down 10.8 per cent on this time last year.
The average remortgage loan amount has risen by 3.9 per cent over the past month and now stands at £145,754. This is the highest figure we have on record.
Commenting on the latest figures, Andy Knee, Chief Executive of LMS says: “May marks yet another month of growth for the remortgage sector, with the total remortgage lending figure rising by 17.1 per cent to £3.9 billion. These heights have not been seen since October of last year. Despite a considerable increase in gross mortgage lending, remortgages continue to account for more than a quarter of the market.
“The average loan per person is at an all-time high, with an average of £19,325 being released to spend of paying off debts or to supplement income. We have seen a brilliant start to the year and we expect it to continue as the Funding for Lending Scheme (FLS) continues to encourage competitive rates for remortgage customers.”