Posts with tag: remortgaging

New Figures Confirm that Buy-to-Let Landlords are Rushing to Beat Stamp Duty Deadline

Published On: March 9, 2016 at 9:30 am

Tags: buy-to-let landlords,buy-to-let properties,remortgaging,Stamp Duty,valuations

Yet more evidence has confirmed that buy-to-let landlords are rushing to purchase new investment properties to beat the Stamp Duty deadline.

Connells Survey & Valuation has found that in February, it conducted 34% more buy-to-let valuations than in the same month last year, and 25% more than in January.

New Figures Confirm that Buy-to-Let Landlords are Rushing to Beat Stamp Duty Deadline

Meanwhile, remortgaging valuations – including buy-to-let remortgaging – also surged, up by 41% annually and 6% on a monthly basis.

The extra 3% Stamp Duty charge on buy-to-let properties and second homes will be implemented on transactions completed after 1^st April.

The Corporate Services Director of Connells Survey & Valuation, John Bagshaw, comments on the findings: “Buy-to-let investors and those remortgaging with the aim of buying a second home are racing against the clock.

“Expect this activity to reach a crescendo in March before calming in the second quarter of the year. Buy-to-let investors will be calculating the impact the Stamp Duty hike is having on their rental yields, while those thinking of remortgaging to fund a second home will weigh up whether it’s still financially viable for them to do so.”¹

Additionally, the home mover and first time buyer sectors have experienced strong monthly growth in valuation activity. The amount of valuations conducted for first time buyers soared by 36% between January and February, and rose by 8% annually.

Valuations carried out for home movers were up by 35% in February and 9% over the past year.

Overall valuation activity performed well. The total number of valuations conducted in February was up by 21% on the same month in last year.

It was recently announced that the forthcoming Stamp Duty hike is also driving the auction market.

However, conveyancers are concerned about the short timeframe between the next Budget (on 16^th March) and the Stamp Duty change.

¹http://www.propertyindustryeye.com/rush-buy-let-borrowers-try-close-mortgage-deals/

What trends will BTL market follow in 2016?

Published On: January 12, 2016 at 12:18 pm

Author: Em Morley

Categories: Property News

Tags: Buy-to-Let,landlords,remortgaging,rental market

Buy-to let remortgage transactions outweighed purchases by more than two to one in 2015, according to data released by Mortgages for Business.

However, this is likely to change during 2016, if the results for quarter four are any sort of a guide.

In the final quarter of 2014, remortgages for vanilla buy-to-let property accounted for 64% of transactions. HMO’s and Multi-Unit Freehold Blocks saw larger remortgage activity, at 78% and 88% respectively.

Unsurprising

David Whittaker, managing director of Mortgages for Business, noted, ‘the results aren’t surprising; for some time now landlords have been making considerable savings through remortgaging. Many have also been releasing equity to make improvements and plans further purchases, However, I anticipate that we will see a reversal of this trend in the first quarter of this year as landlords hurry to expand their portfolios before the stamp duty surcharge kicks in on 1^st April.’[1]

‘The number of enquiries for purchase finance is already well ahead of where we were this time last year, particularly from those looking to sell their personally owned property into a corporate vehicle,’ he added.[1]

What trends will BTL market follow in 2016?

Pace

Yields for all property types increased in Q4 of 2015 but in real terms, continued to fall as rental income struggled to keep up with rising property prices. Returns for the more complex properties however remained well above the 6% mark.

The total number of lenders in the market remained at 33, with the number of buy-to-let mortgage products rising to an average of 975.

Whittaker observed that, ‘it is unlikely that this average figure will be topped going forward unless new lenders enter the market, or some of the existing providers start to offer products to limited companies. Of course, that figure is only an average-at one point at the beginning of December our tracking system, Mortgage Flow, showed £1,168 products..’[1]

[1] http://www.propertyreporter.co.uk/finance/will-btl-purchases-transcend-remortgages-this-year.html

Leeds BS announce new mortgage deals

Published On: October 7, 2015 at 2:45 pm

Author: Em Morley

Categories: Finance News

Tags: Help to Buy,mortgage products,remortgaging

Leeds Building Society has made additions to its Help to Buy equity remortgage portfolio, announcing two competitive fee-free, two year fixed-rate products.

The new mortgage begins at 2.29% and are available up to 75% LTV, for loan amounts between £150,000 and £300,000. In addition, there is a 2.39% deal, again up to 75% LTV, with a maximum loan size of £150,000.[1]

Both fee-free mortgage deals come with £1,000 cahsback, have a free valuation worth up to £560 and are available through intermediaries for borrowers across England, Scotland and Wales.

Attractive

The new mortgage is available to remortgage customers only. Earlier in 2015, the Society was the first lender to accept remortgage applications from HTB equity borrowers.

Leeds BS announce new mortgage deals

‘Two years on from the launch of the Help to Buy equity scheme, lots of borrowers will be coming to the end of their initial deals and seeking a competitive remortgage package,’ said Martin Richardson, Leeds Building Society’s Director of Business Development. ‘We’d expect the new fee-free versions with £1,000 cashback and free valuation to be attractive to remortgagors who are looking to keep down the cost of switching to a new deal.’[1]

‘HTB1 homeowners can remortgage to a competitive rate with Leeds Building Society and retain their existing loan size, subject to valuation, keeping the Government equity loan. Alternatively, they can choose to redeem the Government equity loan as part of their remortgage up to 90% LTV and buy the property outright, using any one of the Society’s competitive mortgages available up to 90% LTV.’[1]

[1] http://www.propertyreporter.co.uk/finance/leeds-announces-new-htb-remortgage-products.html

Mortgage lending at seven-year high

Published On: September 25, 2015 at 3:11 pm

Author: Em Morley

Categories: Finance News

Tags: housing market,Mortgage lending,remortgaging

Mortgage lending rose to a seven-year high during August, as buyers and remortgagers came back into the market.

According to data from the British Bankers’ Association, a total of £12.2bn was advanced during the month. This was the highest since August 2008.

Highs

Net lending also reached a five-year high of £1.96bn, but mortgage advances have had a slow start to the year, staying around the £500m per month mark.

However, advances did begin to rise in May, after the uncertainty surrounding the General Election was dispelled. Indeed, the market looks strong moving forwards, with total number of mortgages approved increasing across all categories.

The number of loans for people looking to remortgage rose to 25,540 in August, which was the highest level for four years. What’s more, this was 38% above the figure for the same period of 2014. This surge was attributed to people taking out fixed rate mortgage deals in order to maintain control over their monthly repayments, once the Bank Rate does eventually rise.[1]

Mortgage approvals for house purchases only rose, by 16% in comparison to August 2014 to stand at 46,743, the highest level since February last year.

Mortgage lending at seven-year high

Lack of supply

RICS feels that the number of homes on the market stayed at an all-time low during August, with the ongoing shortage of stock stalling the recovery in transaction volumes.

‘People are putting their money into bricks and mortar while interest rates are low and the timing of a likely rate rise remains uncertain,’ said Richard Woolhouse, chief economist at the British Bankers’ Association.[1]

Woolhouse believes that, ‘mortgage borrowing continues to pick up,’ and. ‘the August increase is the largest in five years, although borrowing is still some way below pre-crisis levels. Remortgaging numbers also continue to be strong, as shrewd homeowners snap up competitive deals.’[1]

[1] http://www.zoopla.co.uk/discover/property-news/mortgage-lending-takes-off-after-general-election-24-09-15/?utm_content=bufferce5d9&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer#Ovgsfv1kgv4DfSK8.97

Gross remortgage lending down by 17%

Published On: September 24, 2015 at 12:47 pm

Author: Em Morley

Categories: Finance News

Tags: remortgage lending,remortgage loans,remortgaging

New data from a report conduced by LMS indicates that the total value of monthly gross remortgage lending dropped by 17% to £4.2bn. This was in comparison to July’s figure of £5.1bn and June’s higher total of £5.3bn

Additionally, the report highlights the typical amount of equity withdrawn from remortgaging per customer rose to £35,590 in the last month, with borrowers looking to take advantage of competitive rates.[1]

Record

This figure represents a new record high and a 30% increase on the previous month, when the average amount was £27,315. In addition, it is 76% greater than in August 2014, when the average amount stood at just £20,219.[1]

Affordability was found to be manageable after a 3% annual increase in wages outstripped the slight rise in average mortgage rates. These rates rose to 2.57% in July, from 2.56% in June. With highly competitive rates enticing borrowers to remortgage, the gap between new purchase mortgages and remortgage payments as percentage of income has risen.[1]

Annual remortgage repayments accounted for 17.9% of income, compared to 20.9% for new purchase repayments. This 3% difference was the largest gap since July 2012.[1]

The LMS report also shows that the number of remortgage loan rose by 18% from 22,900 in August 2014 to 27,080 in August 2015. This was still 13% lower than the number of remortgages recorded in July 2015, after remortgage lending slowed following two extremely strong summer months.[1]

Gross remortgage lending down by 17%

Cashing-in

‘Rising house prices and low interest rates mean homeowners are withdrawing record sums of cash from their homes by remortgaging without impacting their loan-to-value as evidenced by a drop in new LTV’s from 55% to 53% in August,’ said Andy Knee, Chief Executive of LMS.’[1]

Knee believes that, ‘an increase in average rates for the first time in nine months, however small, is an indication that we may finally be starting to see the end of record low products and competition among lenders as rumours of an interest-rate rise persist.’ Continuing, Knee said that, ‘despite a sign that the mood might be starting to turn, annual wage growth and the growing gap between mortgage and remortgage payments mean the affordability of remortgaging is better than it has been for years.’[1]

‘Although the Bank of England Governor, Mark Carney, has consistently stated that when the base rate does rise it will occur slowly and gradually, even the smallest rise could see monthly payments increase enough to damage household budgets. Fixing now at a competitive rate would avoid an increase in outgoings that may otherwise be seen. A slight decrease in remortgaging activity from the levels seen at the start of summer is nothing to be concerned about and we anticipate maintained momentum throughout the rest of 2015 and into 2016,’ Knee concluded.[1]

[1] http://www.propertyreporter.co.uk/finance/gross-remortgage-lending-falls-17-in-august.html

More homeowners looking to remortgage

Published On: September 17, 2015 at 4:17 pm

Author: Em Morley

Categories: Landlord News

Tags: homeowners,mortgage wars,remortgaging

New research has indicated that up to one in six UK home-owners are considering remortgaging their property during the next six months. The so-called mortgage price wars are persuading a number of property owners to take advantage of record low prices.

According to a report from the Nottingham Building Society, homeowners are looking to save over £1,100 per year by going through the remortgaging process.

Increases

Data from the report shows that remortgaging activity increased by 15% month on month. Experts are predicting a further surge with the news that recent rate cuts have seen many five-year fixed rate mortgages fall below 2%.[1]

Further findings indicate that five-year fixes are the most popular option for customers considering remortgaging, with 27% saying this was the case. 21% preferred a two-year fixed-rate deal.[1]

Overwhelmingly, three-quarters of respondents said that they would choose a fixed-rate term. 12% said they would prefer a deal for longer than five years.

Only 7% of those questioned said they would go for a tracker deal, 4% said they would consider discount deals and 7% said they would choose a standard variable deal.[1]

Taking advantage

The mortgage price war is interesting to existing home owners who are keen to take advantage of the record low rates,’ said Ian Gibbons, senior mortgage broking manager for Nottingham Mortgage Services. ‘With interest rates expected to rise in the coming years then now could well be the right time for many to consider whether there are savings to be had,’ he added.[1]

More homeowners looking to remortgage

Gibbons explained that, ‘potentially, savings are higher than the average £99 a month people are looking for. Someone with a £150,000 mortgage who moved from a deal a 4% to one at 2% could be around £3,000 a year better off.’[1]

‘However, to secure the best remortgage deal it is important to look at more than the base rate. You need to search the whole market and to be aware of the product fees that may be charged. A great rate won’t save you much if you have to pay a high fee,’ he concluded.[1]

[1] http://www.propertywire.com/news/europe/uk-property-market-mortgages-2015091710992.html