Mortgage approvals in the UK have seen a continuous decline, dropping from 49,500 in July 2023 to 45,400 in August 2023, following a previous decrease from 54,600 approvals in June 2023. Open Property Group has conducted research into the current state of mortgage approvals in the UK, its implications for current and potential homeowners, and has gained exclusive insights from industry experts. Here’s what the experts had to say:
Question 1: Do you forecast an uplift in UK Mortgage Approvals within the next 12 months?
Ben Grey from CHN Financial Consultancy believes that an uplift is unlikely. He points out that valuers are being cautious, often resulting in buyers needing extra cash or renegotiating prices, which is challenging in the current market conditions.
Mark Hansard from First Financial, on the other hand, is optimistic. He anticipates an approval uplift, especially as people have become more accepting of slightly higher interest rates. He also notes an increase in housing stock due to Buy-To-Let landlords selling their portfolios, creating opportunities for first-time buyers.
Question 2: Have you spotted any Mortgage Approval patterns across specific regions?
Ben Grey suggests that while it’s not strictly region-based, areas with inflated house prices in recent years are experiencing stricter valuations, particularly in higher-value areas.
Question 3: Have you spotted any Mortgage Approval patterns based on property type?
Wayne Hill from M&G Mortgages observes that more people are turning to flats than houses in the transactions they have handled.
Question 4: Have you spotted any Mortgage Approval patterns based on first-time or second-time buyers?
Wayne Hill notes that there are more approvals for first-time buyers than second-home movers. He attributes this to second-time movers being cautious about doubling their mortgages, especially as interest rates are increasing.
Mark Hansard of First Financial discusses the “new normal” in mortgage lending, where some lenders offer increased income multiples for higher earners, and interest-only options are becoming more accessible if there’s a suitable repayment plan in place. He believes it’s not a bad thing if first-time buyers become accustomed to interest rates between 3% to 4.5%.
Open Property Group, specialists in helping homeowners sell their properties quickly, regardless of economic conditions, believes that despite market uncertainty, there’s a growing understanding of what the “new normal” in interest rates will be compared to a year ago. Opinions among experts vary, but the fluctuating market conditions suggest a more cautious outlook.
For the full Expert Commentary Q&A, visit: https://www.openpropertygroup.com/landlord-hub/uk-mortgage-approvals/