January has never been a particularly strong month for mortgage data and this year the drop has been exacerbated by the stamp duty holiday that ended in December and last month’s dire weather.
However, activity picked up towards the end of January and into February so we expect to see stronger figures from February on until they begin to tail off again in the second half of the year.
January’s figures shouldn’t dampen the spirits as the mortgage market has got off to a flyer compared to this time last year, with hundreds of new products hitting the market and enquiry levels rising dramatically.
Apparently, according to some sources, remortgaging is now back in vogue and enjoying somewhat of a renaissance as it is officially now the case that remortgage products are cheaper than most lenders Standard Variable Rates.
Some of us have already been talking about this since the start of the year, and it is nice to be backed up by some weighty reports. Moneysupermarket.com, for example, have stated that even when taking the new mortgage product arrangement fees into account the “best” fixed rate and the “best” tracker product over 2 years will beat the majority of lenders SVR’s.
With apologies to The Blow Monkeys for lifting the title of their debut album, (I love a music link), for some reason this phrase popped into my head when the latest quarterly GDP figures were released showing that we have just about limped out of recession.
The political soothsayers have been having a field day showing how we were the first into recession and the last out, and that the road ahead is going to be a frankly tortuous affair. Even Alistair Darling could not rule out the possibility of a dip back into the negative almost on the eve of the election.
There has been alot of press recently about the fact tracker rate products are more “popular” than fixed rates and whilst this is undoubtedly the case, could this be a big problem in the making?
It is of course no surprise that in recent times the popularity of the fixed rate product has waned as people come to terms with the financial environment. The “as cheap as possible please” line has been even more popular than usual as not only have many clients expected that Bank Base will stay low, but also that low tracker rates now are a shot in the arm to many, helping to keep the wolf from the door.
There have been more than a few welcome signs in the mortgage market of late as competition between lenders seems to have made a welcome return, reflected in some rate cutting across many different products in the past few days.
Most lenders seem to have got in on the act with some competitive tracker products and fixes as well as more higher loan-to-value products making an appearance.
This is of course good news for consumers and mortgage brokers alike as more choice comes back into the market. The one thing to watch, however, is the continuance of not just some strict underwriting policy, which is hard to really argue against, but some more “unfair” policies if that is the right word.
Andrew Montlake, Communications Director at Coreco and ‘Mortgage Personality of the Year 2008’, gives his views — honest and no holds barred — on the latest developments within the mortgage and property markets.
