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Following the government’s announcement that the housing market is effectively on hold due to the coronavirus, property experts have speculated on how this will affect the sector moving forward. Hansen Lu, property economist at Capital Economics, expects mortgage approvals for house purchases to drop by 70% between April and June compared with the first three months of the year. Howard Archer, chief economic adviser at consultancy EY Item Club, added that the suspension will hit the wider economy as the world plunges into recession. “Obviously, all the players involved in a house purchase – estate agents, surveyors, removal companies – will not be generating any business, while banks will not be generating any income from new mortgages,” he said. Banks are also expected to take a significant hit because they will not generate revenue from issuing mortgages. Aaron Strutt of Trinity Financial, a mortgage broker, said that even those who had agreed mortgage terms faced major problems. “We can get mortgages agreed and applications submitted, but we cannot confirm exactly when they will be offered.”
The Daily Telegraph (27/03/2020) Daily Mail (27/03/2020) I (27/03/2020)
Nearly a third of all mortgage deals have been pulled from the market in just three weeks following the impact on the industry by the coronavirus outbreak. There are currently some 3,654 residential mortgage deals on offer from banks and building societies in the UK, according to Moneyfacts – 1,585 fewer than the 5,239 deals available on 11 March, a drop of 30%. Mortgage lenders including Nationwide and Santander have blocked loans to buyers with deposits smaller than three quarters of the property's value, while NatWest and Halifax will now only lend up to 80% of a property's value to new customers.
The Daily Telegraph (31/03/2020) Daily Mail (31/03/2020)
Recent figures have revealed the strength of the housing market before the Coronavirus crisis took hold in Britain. Mortgage approvals for house purchase achieved a six-year high in February, reaching 73,500, according to the Bank of England. Approvals for remortgages also rose to 53,400 last month. Net mortgage borrowing by households was £4.0bn in February, close to the average seen over the past six months. Andrew Montlake, managing director of the mortgage broker, Coreco, commented: "Never before has such strong mortgage approvals data rung so hollow. It feels like it came from another time.”
Daily Express (30/03/2020) I (30/03/2020) The Times (30/03/2020)
Homebuyers and sellers have told by the government to delay transactions due to the coronavirus outbreak, effectively putting the housing market on ice. The move came after talks between ministers and lenders, with banks wanting a full suspension of the market amid concerns about the impact of coronavirus and about granting credit. Bankers have also told ministers that surveying properties had become difficult in the current situation. Mortgage lenders agreed on Thursday night to extend all house purchase loan offers by three months to give borrowers more time to complete transactions.
The Daily Telegraph (27/03/2020) Financial Times (27/03/2020) The Times (27/03/2020)
Galliard Homes says that the majority of its Orchard Wharf development, off Silvocea Way in Canning Town, has secured 78% forward sales ahead of completion. Due to launch in the third quarter of 2021, the 288,000 sq ft project will eventually provide 338 apartments. David Galman, sales director of Galliard Homes commented: “Orchard Wharf provides the best value starter homes in London’s Docklands, so the sales success at the development comes as no surprise to our team. We anticipate continued success at Orchard Wharf, and are excited to see the finished development once construction is complete.”
Bdaily (23/03/2020)
Howard Archer, chief economic adviser to the EY Item Club, has warned that the coronavirus outbreak will bring UK house prices to a “juddering halt” in the coming months. He was speaking after data from the ONS showed that UK house prices fell by 1.1% between December and January, although they were up 1.3% on the previous year. Average UK house prices increased 1.1% over the year in England to £247,000. In Wales, they rose 2% to £162,000. And they were 1.6% up in Scotland to £152,000, and 2.5% higher in Northern Ireland to £140,000.
City AM (25/03/2020)