Market could slow after Budget rush

28 June 2010

At the beginning of June Nationwide Building Society announced that property prices were 10% below the 2007 peak.

This seems to be in line with an upswing we have witnessed in consumer demand for mortgages.

Our most recent data for May shows that 24% more consumers sought advice about mortgage deals on Moneysupermarket.com compared with April. Remortgage leads saw an equally healthy rise of 19%.

This upswing is in stark contrast with the market doldrums we experienced in February, when the appetite for mortgages and remortgages plummeted.

It was apparent that as consumers awaited the March Budget both remortgage and purchase enquiries saw dramatic falls of 26% and 15% respectively.

It’s now nearly three months since former chancellor Alistair Darling announced that Stamp Duty would be scrapped on homes under £250,000 and it appears that consumers are regaining some confidence.

Despite this we know that remortgage levels are still low and there’s some way to go before the market is truly back on track. But brokers can take heart from the rise in the number of consumers taking their first steps on the property ladder.

It will be interesting to see how individuals react following the emergency Budget because I believe the uncertainty prior to it was a big reason for the uplift we saw in mortgage activity - consumers were looking to fix their rates before Budget changes.

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