The Mortgage Market Q3, 2018

These blogs and the information contained in them may no longer be current and therefore much of the information/figures quoted could be out of date and shouldn’t therefore be used as an indication of the current situation. If you require any further clarification please contact Derngate Wealth.

Your home may be repossessed if you do not keep up repayments on your mortgage.

According to figures from UK Finance, buy to let lending remains subdued as a result of recent tax, regulatory and legislative changes. In addition, demand for house purchases for both first-time buyers and home movers has also lessened as affordability constraints continue to present a barrier to property ownership and refinancing.

Lenders signed off 58,800 mortgages in September, a fall of 6.5% compared to the same time last year, according to figures from UK Finance. This is the lowest number of mortgages lent in the month of September since 2014.

In particular, there has been a fall in the number of new mortgage issued over the last 12 months due to the new tax rules on buy-to-let properties, and the wider property market shows signs of slowing down.

Although there was an overall drop in the number of mortgages signed off, this was due to the large fall in buy-to-let purchase mortgages approved due to rule changes in the past few years, which increases the amount of tax purchasers must pay. In fact, buy to let mortgages fell faster than other types of borrowing with the number dropping by 18.8% since September 2017 to 12,300. The total value of lending for these types of loans also fell by just over 22%. There could also be further declines in the purchase of buy-to-let properties after changes announced last month’s budget which will affect landlords

Similarly, mortgages issued to those moving home dropped by 8.4% which is the lowest level since 2010. First time buyer numbers fell too but the total value of lending remained the same year on year. The average first time buyer taking out a mortgage in September this year was aged 30.

In the latest Budget, Chancellor Philip Hammond unveiled plans to reduce the time period in which homeowners can claim relief on capital gains tax by half, meaning they will have a larger bill when they decide to sell.

Talk to us at Derngate to find out more about the mortgage market, and to find the best mortgage deal for your individual circumstances.

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