View more on these topics

Market Watch: The property market is more skewed than it has been for a while


The average London property price, now half a million, skews the UK market, and RBS bankers set up desks on Facebook

The average property price in London has hit £500,000, according to the Land Registry. FT research suggests that with a required deposit equal to six months’ wages, Londoners’ dreams of becoming homeowners are getting further and further away.

This frustration is rippling out across the country as constrained supply and high demand continues.

Meanwhile, sales in the £1m-plus market have slumped due to the increase in stamp duty, with LonRes suggesting sales between £1m and £2m fell 22.5 per cent between July and September. But there has been a new wave of “million pound towns”, such as Cobham, where the average home is over £1m.

It seems the UK market is more distorted than it has been for a while, making a national housing policy even more tricky. This is also the reason why using a blunt instrument, such as loan-to-income caps, will not solve all the issues.

In the markets this week, three-month Libor is unchanged at 0.58 per cent, while swap rates have sprung up.

2-year money is up 0.08% at 1.0%
3-year money is up 0.09% at 1.19%
5-year money is up 0.10 at 1.51%
10-year money is up 0.09 at 1.93%


Nationwide is making product rate reductions, with big cuts between 80 and 90 per cent LTV. It now has a two-year fixed at 2.34 per cent to 80 per cent LTV, a 2.64 per cent two-year fix at 90 per cent LTV and a 90 per cent LTV tracker at 2.89 per cent.

Precise has further improved choice, with a range of four-year fixed products starting at 3.79 per cent with a low reversion rate.

Santander’s large loan products on mortgages up to £3m are now available with a two-year fix at 1.79 per cent and a five-year fix at 2.84 per cent, both with a £1,995 arrangement fee. It has also expanded its buy-to-let products, with two-year fixes from 2.29 per cent and five-year fixes from 3.29 per cent with £1,995 fees.

Accord’s new buy-to-let products include a 1.89 per cent two-year tracker at 60 per cent LTV, with a £2,495 fee and incentives.

Virgin Money has some new buy-to-let intermediary exclusives, with a two-year fixed from 1.84 per cent and five years from 2.99 per cent with £2,495 fees. For a 10-day period it has also increased cashbacks to £750.

Finally, it was interesting to note RBS bankers will be using Facebook to communicate with each other, swap information and potentially offer banking services to the public. This is through the new Facebook at Work concept, which involves a desktop and mobile app working with high security features. Whether it is through initiatives such as this, the development of Blockchain technology or putting a whole bank on a phone app, change is coming fast.

You have been warned.

Andrew Montlake is director at Coreco 




Dragonfly Property Finance set to rebrand

Short- and medium-term lender Dragonfly Property Finance is set to rebrand as Octopus Property in the first half of next year. The lender, which launched in 2009, is part of The Octopus Group, an investment business with over £5.5bn of funds under management. Dragonfly managing director Mark Posniak says: “Octopus has been instrumental to Dragonfly’s […]

TSB store front 700 x 450

TSB launches its first ever securitisation

TSB has launched its first ever securitisation and is currently holding a road show for investors. The bond, called Duncan Funding 2015-1 plc, is made up of prime owner-occupied loans and the pool size is £2.3bn. The majority of the loans were originated between 2012 and 2015 and the weighted average LTV is 76.1 per […]


Letters: Networks are not all the same; many of us do care

Networks are not all the same; many of us do care “Do networks really care about their members?” asked Stuart Gregory recently within these pages. Well, this one does. Stuart poses some interesting questions not just about the value that AR firms receive from their network but also in terms of the network structure and […]


MAS director on £200k a year exits

One of the Money Advice Service’s highest paid directors who earned over £200,000 last year has quit the organisation. Lesley Robinson joined the MAS in 2011 as UK debt advice and corporate services director. She became one of its highest paid members of staff, taking home more than £200,000 in 2014/15. Robinson earned a total […]


News and expert analysis straight to your inbox

Sign up

Why register with Mortgage Strategy?

Mortgage Strategy continues to be the market-leading B2B mortgage publication in the UK, and provides trusted, independent insight with the aim of helping, promoting and analysing the latest developments for mortgage professionals.

News & analysis delivered directly to your inbox
Register today to receive our range of news alerts including daily and weekly briefings

Mortgage Strategy Events
Be the first to hear about our industry leading conferences, awards, webinars and more.

Research and insight
Take part in and see the results of Mortgage Strategy's flagship investigations into industry trends.

Have your say
Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

Register now