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Chestertons Residential Observer May 2017

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Borrowers in the UK are seeing the lowest ever mortgage rates being introduced as lenders battle to meet their targets. Atom Bank introduced a 1.29% fixed five year mortgage at the beginning of April although this is no longer available due to its popularity. Shortly afterwards the Yorkshire Building Society launched the lowest mortgage rate ever available in the UK at 0.89% and Santander is now offering a two year loan at 1.14% and adding new products to its range.

Parents across the country are expected to lend £6.5 billion to their children this year – 30% more than last year helping them buy homes with a collective value of £75 billion.

One in four property transactions in the UK is now funded by parental help, with average contributions set to rise from £17,500 to £21,600. 79% of funding goes to people under 30 and nearly two in five Londoners receive help from parents.

The mortgage market in the UK is this year expected to see the highest level of gross lending since 2007. According to the Intermediary Mortgage Lenders Association (IMLA) total gross mortgage lending will reach £260 billion in 2017, some 5.9% higher than in 2016. It predicts that the re-mortgage sector will be the most buoyant while the buy to let mortgage market will continue to contract in 2017 before growing modestly in 2018.

The equity release sector in the UK saw record year on year growth in 2016 and in the first quarter of 2017 has continued to break new ground, according to the Equity Release Council. It is experiencing record numbers of new customers with 8,351 new plans agreed in the first quarter of this year, a rise of 61% on the corresponding period in 2016, while the total value of lending reached £697 million, a rise of 77%.

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Nick has more than 20 years’ experience within the property research arena.

Nick Barnes

Nick Barnes

St Magnus House

020 3040 8406