Docklands News

A rush to lock in low borrowing costs sparked the biggest rise in mortgage lending in eight months as net mortgage lending leapt to £7.4bn in May, up from £4.2bn the previous month, despite a jump in interest rates for borrowers, new Bank of England data showed. The data revealed that borrowers suffered the biggest six-month surge in mortgage rates in a decade. Average interest rates on a new mortgage have jumped almost 50 basis points in six months and rose a further 13 basis points in May to 1.95%. The rate on the outstanding stock of mortgages ticked up two basis points to 2.07%. The number of mortgages approved for house purchases ticked up to 66,200 in May, from 66,100 in April. This was below the 12-month pre-pandemic average up to February 2020 of 66,700. Approvals for remortgaging were unchanged at 47,800 in May, below the 12-month pre-pandemic average up to February 2020 of 49,500 - but these statistics only reflect those remortgaging with a different lender and the number entering a new deal with their existing lender is likely much higher. 

Daily Mail (02/07/2022)   The Daily Telegraph (02/07/2022)  

A typical home in the UK now costs more than seven times average earnings, new data has revealed. Research from Halifax found that, since the start of the pandemic, property prices have risen 16.8% from £239,281 while average incomes have only increased by 2.7% from £38,374. In the first quarter of 2022, the cost of an average home in the UK was £279,431, while annual average earnings of a full-time worker were estimated to be £39,402. London was found to be the most expensive place to buy a home, with an average property price of £534,977 and house price-to-earnings ratio of 9.7. Westminster and the City of London, however, witnessed the sharpest improvement in the house price to earnings ratio since the start of the pandemic, with a drop from 16.8 in early 2020 to 14.5 in 2022.

Daily Mail (25/06/2022)  

Down valuations are being blamed for an increase in abandoned house sales, with property experts reporting huge differences between home sellers' asking prices and formal valuations. According to online broker Mojo Mortgages, down valuations affected 12.8% of all house purchase mortgages in April, up from 10.4% during the same period last year. Richard Hayes, co-founder and chief executive of Mojo Mortgages said the problem is also affecting property owners trying to remortgage. He added that down valuing on remortgages has fallen in recent months, but is much higher than for purchase mortgages, standing at 15.4% in April. A rise in down valuations is sometimes seen as a precursor to a price crash, "[But] our data is not showing this to be the case. We believe it is more likely to be people trying to take advantage of a buoyant market and not quite getting it right." 

I (28/06/2022)  

Borrowers are paying charges to get out of their mortgages early so they can move onto new deals before rates increase further. Yorkshire Building Society customers paid 88% more in early repayment charges in the first five months of this year than in the same period of 2020. "More borrowers are considering their options before coming to the end of their deal. With rates seemingly only heading in one direction, I suspect we'll see similar activity throughout the year at least," commented Ben Merritt, the director of mortgages. 

The Sunday Times (26/06/2022)  

Secondary property purchases accounted for 29% of all property sales in London last year compared to 23% in the rest of England, an analysis has found. According to data collated by Octane Capital on property purchases in the last financial year, second property purchases accounted for 50% of sales in some London boroughs. The most active additional home market in London was Kensington and Chelsea where 1,200 additional home purchases equated to 52% of all market activity in the borough. The boroughs with the lowest percentage of additional homes were Waltham Forest, Lewisham, and Bexley, in all of which they account for 21% of market activity.

Plans have been submitted for a 52-storey residential skyscraper on the Isle of Dogs in London. One East Point, designed by architect Make at the site of 4 & 5 Harbour Exchange Square for client GAW Capital, is an an 170m-tall stepped tower that will provide nearly 460 flats. A mixture of affordable homes and market homes are planned for levels up to the 24th floor, with upper levels for market sale. It is expected that construction could begin in the first quarter of 2024 on a four-year plus programme that would see the building completed in the summer of 2028. 

Construction Enquirer (21/06/2022)