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Halifax to lower five-year fixed rates

Halifax will lower select homebuyer five-year fixed rates, which includes first-time buyer, new build, large loans and affordable housing and green home products.

The changes will come into force from Monday 21 August.

An example of rate changes includes its no-fee five-year fixed rate at 80 per cent loan to value (LTV) will decrease by 0.11 per cent to 5.48 per cent.

The lender’s no-fee five-year fixed rate at 85 per cent LTV will go down by 0.12 per cent to 5.48 per cent.

Halifax’s five-year fixed rate at 80 per cent LTV will reduce by 0.11 per cent to 5.37 per cent and at 85 per cent LTV pricing will fall by 0.12 per cent to 5.37 per cent as well.

The loans are available between £25,000 and £1m.

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A positive boost for the market’

Jamie Lennox, director at Dimora Mortgages, said that it was “great to see the UK’s biggest mortgage lender return with a further reduction on selected products”.

“This is a positive boost for the mortgage and property market given that markets are baking in further base rate increases following core inflation remaining sticky.

“It’s likely that the speed at which rates went up caused a firm halt in the number of new applications being received and we may now see lenders chasing their tails in the months to come to try and make up for being behind on their targets for the year. Only time will tell, but we hope to see more to follow,” he added.

Read about the UK Housing Market via our Specialist Residential & Buy to Let Division

Peter Stamford, director and lead adviser at Moor Mortgages, said: “Halifax is making assertive moves to bolster its mortgage portfolio, a likely response to the subdued business volumes in recent months.

“With markets anticipating further base rate hikes due to persistent core inflation, the UK’s leading mortgage lender’s rate reductions may be short-lived. As the industry sees a slowdown in new applications, other lenders might soon follow Halifax’s lead. Borrowers should seize these opportunities, but with caution, as the financial climate remains unpredictable.”

By Anna Sagar

Source: Mortgage Solutions

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Halifax: UK housing market outlook for 2020

According to the Halifax, the housing market performed in line with expectations over the past year, at the lower end of its 2% to 4% growth forecast.

Prospects for 2020 look brighter but house price inflation is expected to remain relatively weak, at between 1% and 3%.

A shortage of homes for sale, low levels of house building and challenges facing first-time buyers will continue to support high prices and constrain demand in the short-term

Russell Galley, managing director at Halifax, commented: “The housing market in 2019 followed a similar path to recent years. Modest price growth was supported by falling mortgage rates and a low volume of houses for sale, factors which can in part be attributed to elevated uncertainty. This helped to underpin a degree of resilience in the market.

“Prospects for 2020 look a bit brighter, with uncertainty in the economy falling back somewhat, transactions volumes anticipated to pick up and further price increases made possible by growth in households’ real incomes. However the shortage of homes for sale and low levels of house building will continue to support high prices, while the challenges faced by prospective buyers in raising the necessary deposits may continue to constrain demand.

“As a result, our forecast for house price growth in 2020 is in the range of 1% to 3%, consistent with the pattern of weaker growth seen since 2017.

“Longer-term, a renewed focus on housing policy and increased infrastructure investment aimed outside the South East, for example, could help rebalance regional house prices. However, it’s important to note that any policy changes would be unlikely to impact the market in 2020.

“Although prices will be supported in the near-term by insufficient new building and low interest rates, a sustained period of price growth below income growth as a result of policy action would help to address first-time buyer difficulties.”

By Joanne Atkin

Source: Mortgage Finance Gazette

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Halifax says annual house price inflation slows to lowest growth so far this year

Average house prices were £232,249 in October, Halifax has reported.

The lender said this brought annual inflation to 0.9%.

Halifax managing director Russell Galley said: “Average house prices continued to slow in October, with a modest rise of 0.9% over the past year. While this is the lowest growth seen in 2019, it again extends the largely flat trend which has taken hold over recent months.

“A number of underlying factors such as mortgage affordability and wage growth continue to support prices, however there is evidence of consumers erring on the side of caution.

“We remain unchanged from our view that activity levels and price growth will remain subdued while the UK navigates economic uncertainty.”

The Halifax, which has recently changed how it calculates prices after criticism that its indices were out of sync with others, is still at odds with Nationwide, which also bases its numbers on mortgage approvals.

Nationwide puts the average house price in October at £215,368, saying that annual house price inflation was 0.4%.

By ROSALIND RENSHAW

Source: Property Industry Eye

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House Prices Recover in April

House prices in the UK grew 1.1% in April after a fall in March, according to the latest figures from Halifax.

The Halifax house price index revealed in March that house prices fell 1.3% over the month. However, prices rebounded in April with a 1.1% monthly rise, pointing to the volatility in the country’s housing market. House prices had been expected to fall by 1.6% over the month. The average price of a home in the UK now stands at £236,619, according to the country’s largest mortgage lender.

Average property prices were also up compared to last year. In the three months to March 2019, UK house prices grew sharply by 5% compared to last year, while a growth of only 4.5% was expected. This annual growth rate was almost double that seen in the previous month, when house prices grew 2.6% year-on-year in the three months to March. It is also higher than the average annual house price growth seen over the last decade. For the last ten years, the average price of a home in the UK has risen by £81,956, or an average of 4.3% each year.

However, surveys from other lenders show differing results than those from Halifax. According to the Nationwide Building Society, for example, annual house price growth in the UK has been below 1% for the last five months in a row.

“The blistering volatility of this index has returned as the Halifax house price weather vane spins itself into a frenzy once more,” said Lucy Pendleton, founder and director of estate agents James Pendleton. “The index has already come under scrutiny this year after months of erratic monthly growth figures. These can be more sprightly than the smoothed annual and quarterly numbers, but even so, they’ve been turning heads with the extremes with which they have been moving.

“One explanation for ricocheting growth figures like this is persistently low stock levels. In sought after areas, this can lead to demand being supercharged one minute and gone the next, with price rises coming in waves as brief competitions for limited numbers of homes come and go.”

Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said: “Less volatile measures point a far more subdued picture. For instance, Rightmove’s measure of online asking prices fell by 0.1% year-over-year in April, while Nationwide’s measure rose by a mere 0.9%. That said, we doubt that house price growth at the national level is about to turn negative for a sustained period.

“Mortgage rates have held steady for low LTV loans and have fallen steadily over the last year for high LTV products, offsetting some of the impact of Brexit uncertainty on high demand. In addition, maximum mortgage terms have continued to lengthen, pushing down monthly repayments and thereby making home ownership initially appear more attractive.

“Meanwhile, year-over-year growth in households’ real incomes remains on track to pick-up this year to about 2.5%, from 2.2% in 2018, thanks to lower inflation and more supportive fiscal policy. Accordingly, we still think that year-over-year growth in the official measure of house prices will pick up to around 1.5% by the end of 2019, from 0.6% in February.”

Source: Money Expert

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House Prices Down 2.9%, Halifax Reports

House prices in the UK fell by 2.9% last month, according to Halifax’ latest report.

The January decrease comes after 2.5% growth in December 2018. House prices grew by 0.8% in the year to January, down from the 1.3% annual rise seen in December. This is the second time in the last three years that house prices have seen a monthly drop in the first month of the year. The average house price in the UK now stands at £223,691 by Halifax’ calculation.

“Attention will no doubt be drawn towards the monthly fall of -2.9% from December to January, the second time in three years that we have seen a drop as a new year starts,” said Russel Galley, managing director at Halifax.

“However,” he added, “the bigger picture is actually that house prices have seen next to no movement over the last year, with annual growth of just 0.8%.

“This could either be viewed as a story of resilience, as prices have held up well in the face of significant economic uncertainty, or as a continuation of the slow growth we’ve witnessed over recent years.”

Analysts have suggested the uncertainty surrounding Brexit is putting off potential buyers, and that the outlook of the UK’s housing market in 2019 will depend on the transition the country faces after we leave the EU on March 29.

“January is often a tough month, in which sellers who have failed to shift their home in the previous year typically cut the price in order to drum up interest,” said Jonathan Hopper, managing director of Garrington Property Finders. “But the confidence-sapping uncertainty of Brexit is getting worse, not better, and the next few months will be decisive.”

The significant role of Brexit in the slowdown of the housing market was reiterated by Mark Harris, chief executive of mortgage brokers SPF Private Clients. “Flat growth is probably the best we can hope for, given the current tricky political situation we find ourselves in,” said Harris. “Brexit has caused a slowdown in purchase activity as would-be buyers sit on their hands, waiting for the outcome before committing to something as major as buying a new home.”

Russell Galley said: “There’s no doubt that the next year will be important for the housing market with much of the immediate focus on what impact Brexit may have. However, more fundamentally it is key underlying factors of supply and demand that will ultimately shape the market.

“On the supply side the most constraining factor to the health of the market is the shortage of stock for sale, although this does support price levels. On the demand side we see very high employment levels, improving real wage growth, low inflation and low mortgage rates. All positive drivers tempered by the challenges of raising deposits. On balance therefore we expect price growth to remain subdued in the near term.”

However, some analysts are holding out hope that the housing market could yet see an upturn after the initial impact of Brexit.

Andy Soloman, founder and CEO of business growth advisers Yomdel, said: “The coming months are likely to bring some small green shoots of price stability and once we emerge from our Brexit blanket in to the cold light of day having reached an agreement, further stability and upward growth should return to the market.”

Source: Money Expert