The latest rumblings of discontent around the financial community have been centred around the issues that beset Dubai, the land where dreams have been built, quite literally, in the sand.
Unfortunately, the sand seems to be capricious ground at best, and another wave of banking losses have been predicted, with reports of anything around the $40 to $50 billion level being the amount that European banks are exposed to. Then again what’s this piddly amount between friends after the recent figures we have seen bandied around?
A week may be a long time in politics, but in the lending market at the moment a week can represent a complete transformation in product choice that would normally evolve over a long period of time.
In a short space of time we have seen the return of some welcome elements of competition which, together with a fall in the cost of funds, has pushed product rates down. Some lenders, such as a re-invigorated Woolwich, have cut their rates by up to 0.6%, whilst others such as a totally reformed Northern Rock, have made an aggressive play to dominate the Best Buy charts.
With fixed rates having risen in recent weeks and now looking a tad overpriced, especially for longer term fixes, tracker products are booming again due to headline rates with a “1” at the start.
Whilst HSBC have stolen all the headlines with their 1.99% lowest rate ever malarkey, (actually the lowest rate I remember was 0% for 6 months!), Woolwich have quietly taken up the fight and slipped in a stepped tracker product starting at 1.98% !
The other day I caught, almost by accident, the new Apprentice type programme on BBC which I found fascinating. Fascinating because the new SirAlan is none other than the French design genius Philippe Starck – brilliant, off the wall and tremendous fun to watch. Anyway, his way of looking at things I can really relate to and it could also apply to our own ethos at Coreco.
For those that don’t know, according to Wikipedia “Philippe Starck is a French product designer and probably the best known designer in the New Design style. His designs range from spectacular interior designs to mass produced consumer goods such as toothbrushes, chairs, and even houses.”
A very interesting product was released today by Lloyds Tsb which shows two things. Firstly it has renewed my faith that lenders can still be innovative when the put their minds to it, and secondly that arguably this is a step towards lenders actively encouraging first time buyers back into the Market perhaps believing that house prices will begin to recover soon.
While there are a few conditions to this new mortgage product, they are far outweighed by the positives. 4.39% fixed for three years at 95% LTV is an exceptional rate and, presuming parents still have some spare cash floating around, will be a major fillip for certain first time buyers and therefore the market as a whole.
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.
