Eleanor Williams, Finance Expert at Moneyfacts, said:
“Insight from HMRC attributes the increase in property transactions over the last four quarters to both the introduction of the stamp duty land tax (SDLT) holiday and ongoing strength in the housing market. Although the SDLT holiday is beginning to taper towards its end, there may well be continued momentum in the market as the “race for space” appears to be continuing and lenders could be looking to entice borrowers who for varying reasons may not have been able to proceed before now.
“Our data shows that the amount of choice available to consumers has risen again this month with 4,660 total products on offer, the highest recorded in seventeen months. This demonstrates the level of recovery in the residential sector where, for only the second consecutive month since June 2018, availability rose across all the individual loan-to-value (LTV) brackets as lenders endeavour to accommodate borrowers with varying levels of deposit or equity.
“Availability in the lower and mid-LTV sectors has rebounded, where borrowers looking at 80% or 85% LTV options have 152 and 22 more products to choose from than in August 2019. Choice continues to improve in the higher LTV tiers, with growth at 90% and 95% LTV increasing by a further 25 and 22 deals this past month alone. This reflects that, likely supported by the introduction of the Mortgage Guarantee Scheme, providers are prepared to cater to this traditionally higher-risk demographic, although their desire to do so remains some way behind where this was compared to a pre-pandemic August 2019 as there are currently 199 and 116 less deals to choose from than there were two years ago.
“Further good news is that both the average overall two and five-year fixed rates fell by 0.03% this month. The two-year fixed rate of 2.52% is only 0.03% above where this sat two years ago, while the five-year equivalent of 2.75% is 0.09% below where it sat August 2019. These falls are perhaps fuelled not only by the growing number of lenders launching sub-1% deals predominantly in the lower LTV tiers, but we have also seen rate re-pricing across the higher LTV lending brackets, particularly at 90% LTV where the two-year fixed average fell by 0.14% and the five-year by 0.13% this month alone.
“This month has seen the average shelf life for a mortgage product reduce by 9 days to just 21 days, last seen in May 2017 and the joint lowest we have recorded. Borrowers considering their mortgage options may therefore find that products have a limited period when they are available, and so having the up-to-date market knowledge of a qualified adviser could be invaluable in ensuring they can secure their chosen product in time.”
Moneyfacts Treasury Reports are the definitive monthly analysis of Mortgage and Savings trends emailed in PDF format. Unsecured Lending trends analysis is emailed quarterly. Available by annual subscription, please call (01603) 476850.
Eleanor Williams, Finance Expert at Moneyfacts, said:
“Insight from HMRC attributes the increase in property transactions over the last four quarters to both the introduction of the stamp duty land tax (SDLT) holiday and ongoing strength in the housing market. Although the SDLT holiday is beginning to taper towards its end, there may well be continued momentum in the market as the “race for space” appears to be continuing and lenders could be looking to entice borrowers who for varying reasons may not have been able to proceed before now.
“Our data shows that the amount of choice available to consumers has risen again this month with 4,660 total products on offer, the highest recorded in seventeen months. This demonstrates the level of recovery in the residential sector where, for only the second consecutive month since June 2018, availability rose across all the individual loan-to-value (LTV) brackets as lenders endeavour to accommodate borrowers with varying levels of deposit or equity.
“Availability in the lower and mid-LTV sectors has rebounded, where borrowers looking at 80% or 85% LTV options have 152 and 22 more products to choose from than in August 2019. Choice continues to improve in the higher LTV tiers, with growth at 90% and 95% LTV increasing by a further 25 and 22 deals this past month alone. This reflects that, likely supported by the introduction of the Mortgage Guarantee Scheme, providers are prepared to cater to this traditionally higher-risk demographic, although their desire to do so remains some way behind where this was compared to a pre-pandemic August 2019 as there are currently 199 and 116 less deals to choose from than there were two years ago.
“Further good news is that both the average overall two and five-year fixed rates fell by 0.03% this month. The two-year fixed rate of 2.52% is only 0.03% above where this sat two years ago, while the five-year equivalent of 2.75% is 0.09% below where it sat August 2019. These falls are perhaps fuelled not only by the growing number of lenders launching sub-1% deals predominantly in the lower LTV tiers, but we have also seen rate re-pricing across the higher LTV lending brackets, particularly at 90% LTV where the two-year fixed average fell by 0.14% and the five-year by 0.13% this month alone.
“This month has seen the average shelf life for a mortgage product reduce by 9 days to just 21 days, last seen in May 2017 and the joint lowest we have recorded. Borrowers considering their mortgage options may therefore find that products have a limited period when they are available, and so having the up-to-date market knowledge of a qualified adviser could be invaluable in ensuring they can secure their chosen product in time.”
Moneyfacts Treasury Reports are the definitive monthly analysis of Mortgage and Savings trends emailed in PDF format. Unsecured Lending trends analysis is emailed quarterly. Available by annual subscription, please call (01603) 476850.
