Mortgage News

The numbers of people searching for buy-to-let in the UK has seen an increase of more than 2.5 times from the end of March to mid-July, according to Google trends data. As the economic outlook for the Autumn continues to remain bleak and with the expectation of further job losses to come, those saving for retirement may be concerned about another stock market shock and reductions in value to their pensions and investments. Investing in property during difficult economic times is often seen as a safer option with the security of owning a physical asset.
With more people looking at buy-to-let to generate a return on their funds, we explore how investing in property compares to a pension and where to find the best buy-to-let mortgages.

A survey carried out by Nationwide in May found that the lockdown led to 15% of people considering moving home. Whether homeowners are looking for a new home as a result of lockdown or had already planned to move home this year, since lockdown restrictions began to be lifted, the property market has quickly begun moving again. This, coupled with the Government’s stamp duty threshold increase, means that many homeowners will be considering moving home over the coming months.

For those considering moving, we’ve looked at what currently makes it a good time to move home and some factors homeowners should be cautious about.

The housing market is experiencing a mini-boom as a result of pent-up demand post-lockdown and the new stamp duty payment holiday. Rightmove reported a 75% increase of buyer enquiries in July 2020 compared to July 2019 and 44% of sellers that listed from 13 May 2020 have now been marked as sale agreed.
While the demand to buy a home is regaining strength, the availability of mortgage finance has been cut in half, with only 2,526 mortgages currently available from a pre-lockdown number of 5,222. The choice of higher loan-to-value (LTV) mortgages has been hit the hardest and nine out of 10 mortgage deals at the 90% and 95% tiers that had been available on 1 March 2020 have now disappeared.
Buyers with a deposit or equity in their current property of less than 10% will only qualify for 95% LTV mortgages – there are only 20 currently available and, of these, the majority require a guarantor to provide additional security in lieu of a larger deposit or have postcode restrictions as to where they will lend. Those with 10% equity in their current home or as a saved deposit will need a 90% LTV mortgage and, there are currently only 68 mortgages available at this LTV.

This week has seen several rate increases for mortgages, particularly at higher loan-to-values (LTV). Halifax, TSB, Skipton Building Society, Virgin Money and Nationwide Building Society all increased their rates during the week on 85% LTV mortgages. HSBC increased its rates on 90% LTV mortgages, but they remain among the top rates for those with a smaller mortgage deposit.
Barclays Bank, West Brom Building Society and Yorkshire Building Society all withdrew mortgage products during the week, with the changes from Barclays and West Brom Building Society resulting in changes to some of the best mortgage rates available this week.