Docklands News

Figures from UK Finance show that 2021 is on course to be the strongest year for UK home-buying activity since 2006. The trade body said that while the first few months of the pandemic led to predictions that sales would stagnate, the reality was very different, with “COVID-era activity set to eclipse everything since the credit crunch”. The figures come hard on the heels of forecasts from the property website Zoopla and other commentators that 2021 would be the UK's busiest year for the housing market since 2007. While official figures have shown that the number of house sales tumbled in the weeks immediately after the end of the stamp duty holiday, which finished on 30 September, this followed a record surge in activity during the latter half of 2020 and earlier this year. In its latest household finance review, covering the period July to September this year, UK Finance said: “Barring a complete reversal of the current picture, purchase transactions in 2021 will reach their highest level seen since the peak in 2006, just before the global financial crisis [of 2007–08].” 

The Guardian (06/12/.2021)  

The Bank of England is poised to ease mortgage lending rules, prompting concerns of a potential housing bubble. Officials are reportedly considering softening affordability checks for borrowers as part of a review of the market restrictions which concludes next week. One of the measures being looked at is reducing the additional interest rate charge used to test borrowers' ability to pay the reversion rate after an initial deal ends. This would benefit first-time buyers, as tight rules designed to protect them against a return to old-fashioned high-interest rates has made it harder for some would-be homeowners in an era of low borrowing costs. 

The Daily Telegraph (06/12/2021)  

Rishi Sunak’s mortgage guarantee scheme has been used by just nine first-time buyers a day. When the Chancellor first unveiled state-backed 5% deposit mortgages in March, they were hailed as a life-line for potential first-time buyers struggling to save a deposit. However, figures have revealed that take-up has been slow. Between mid-April and the end of June just 812 mortgages completed using the support scheme, equal to 0.7% of all residential mortgage completions, according to figures published by the Treasury. Of the borrowers who used the scheme, only 666 were first-time buyers. Neal Hudson of Built Place, an analyst, said: "The numbers are definitely very low. There will, however, inevitably be a delay because borrowers using the scheme will have had to do so in the early stages of their buying process." 

The Daily Telegraph (03/12/2021)  

First-time buyers have the opportunity to get on to the property ladder at a new neighbourhood in East London. L&Q’s new homes offer some of the first opportunities to buy at Barking Riverside, a community the size of Hyde Park that will eventually host over 10,000 homes, along with commercial and leisure space, public spaces and riverside walks. Claire Brenlund, sales and marketing director at L&Q commented: “Barking Riverside is drawing a fantastic amount of attention from first-time buyers across the capital thanks to the extraordinary facilities it promises, paired with its affordability. Buyers who move to Barking Riverside will get to witness some of the project’s most exciting milestones opening soon, including the launch of Barking Riverside’s London Overground station.”

BDaily (02/12/2021)  

House prices continued to rise in November, despite predictions that the market boom that began last summer would cool off over winter following the end of the stamp duty holiday. Nationwide’s latest house price index revealed that prices rose 0.9% last month with annual growth creeping back into double figures. The 10% year-on-year increase marked an acceleration from October, the first month that wasn’t boosted by the stamp duty holiday, when month-on-month growth was 0.7% and the annual rate grew 9.9%. The average price of a home in Britain now stands at £252,687, according to Nationwide. Prices have risen by more than £33,000, or 15%, since the pandemic started last March. There have already been more housing transactions this year than in 2020 with a month still to go and activity levels are close to those seen in 2007 before the global financial crisis rocked the property market. However, Nationwide's chief economist, Robert Gardner, warned there could be trouble ahead for the market, citing the Omicron variant and falling consumer confidence. Rising interest rates may also exert a "cooling influence", he said. 

Financial Times (01/12/2021)   The Daily Telegraph (01/12/2021)   The Guardian (01/12/2021)   The Times (01/12/2021)  

A First Time Buyer Index surveying 2,015 prospective and 500 actual first-time buyers (FTBs) has revealed that over half (58%) needed to raise a larger deposit than initially intended due to the impact of the COVID-19 pandemic. The average increase was an additional £22,849, bringing the deposit size up to £62,572 (an average of 18.6% of the property value). According to the survey by Aldermore, it took first-time buyers an average of 4.6 years to save up enough to buy a home. Two in five (40%) FTBs took two or more offers to secure the home they bought, stretching out the process and raising costs. Before that, half (49%) were in the process of buying a different property only to have it fall through. This cost new buyers an average of £2,403. Increased challenges and multiple attempts at buying meant first-time buyers faced a delay of an average of three months. These extra barriers and costs meant that 48% felt they did not get the home they wanted because they had to compromise so much to get on the housing ladder. 

Daily Express (27/11/2021)