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.
Stats this week from the Council of Mortgage Lenders show a trend that should warm the cockles of any mortgage broker’s heart, and indeed any in the property market, in that loans for house purchases have gone up 29% on last month.
Whilst it is true this is against a low figure, the scale of the increase is more than expected. Why, even remortgage business has increased by 8%.
There has been a wave of euphoric headlines over the last few days including “Investors bet that worst of recession is over and predict new bull market” in The Times and other commentators suggesting house prices will now stabilise and even rise by the end of the year.
Whilst on the other side of these headlines we also get The Guardian suggesting that “Bank of England braced for third wave of financial crises”, with the new £50b cash injection being used to avert further disaster as banks struggle to increase lending and keep a lid on bad debts.
Up, down, round and round, there is so much contradictory data out there at the moment that buyers — and indeed sellers — don’t know where to turn.
Recent house price stats show anything from another monthly fall to a slight rise, although interestingly the year-on-year stats mainly seem to show between a 15% – 20% fall. What does seem to be clear, therefore, is that the various sources predicting a 40% or even 50% drop are wide of the mark.
Now I am sure I will get pilloried for that comment on places like House Price Crash.com, but I just cannot see another 20% drop on top of this.
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.
