Libor has fallen with the temperature to 0.38 per cent, while swap rates have gone out to do a bit of Christmas shopping
A report out recently from Hometrack found that the gap between income and house prices had reached record levels in some places.
The news itself is not that surprising but the figures are still pretty shocking. In London, the house-price-to-earnings ratio stands at a whopping 14.2 times, compared to 6.5 times across the whole of the UK.
On top of this, the north/south price divide now comes in at £200,000 on average, according to research from eMoov.
At least the Government has a plan in place to tackle these issues and build more of the long-term, affordable properties that people need.
What’s that? Oh…
That said, the latest Nationwide house-price report shows growth is at its lowest ebb for 10 months, with property values increasing by 4.4 per cent year-on-year and just 0.1 per cent on a monthly basis.
According to the report, the average property value across the UK stands at £204,947.
Meanwhile, the big shock news last week (was it really a shock?) was RBS failing the latest set of Bank of England stress tests, meaning it will have to make up a capital shortfall of £2bn, according to reports. Let’s hope it sorts itself out soon.
We are also hearing more talk around a soft rather than a hard Brexit these days, which, let’s face it, was always going to happen. Tough talk initially, then everything is gradually watered down.
In the markets, three-month Libor has fallen with the temperature to 0.38 per cent, while swap rates have gone out to do a bit of Christmas shopping.
- 2-year money is down 0.01% at 0.64%
- 3-year money is down 0.01% at 0.74%
- 5-year money is down 0.02% at 0.93%
- 10-year money isup 0.01% at 1.33
In the product world, Barclays has changed its rates and is offering its “best ever” five-year fixed rate, available at just 1.83 per cent to 70 per cent loan-to-value. It also has a new two-year fix at 80 per cent LTV at 1.95 per cent and a buy-to-let two-year fix to 65 per cent LTV at 2.59 per cent with no fees.
Santander has also made some changes and has a two-year fix available to 60 per cent LTV from 1.29 per cent with a £995 fee, while the five-year fixed version is now at 1.99 per cent.
Not to be outdone, Halifax has reduced some rates on its two-year fixed products by 0.2 per cent, while Nationwide has lowered some tracker rates a touch.
’Tis the season to be jolly and Kent Reliance has decided to offer all those borrowers looking for loans over £1m a 0.25 per cent discount on their fees. Those with group exposure of more than £2m also get the gift.
Meanwhile, Accord is scrapping its upfront mortgage application processing fee from its buy-to-let range and is also reducing rates by up to 0.2 per cent.
In other news, National Counties has become Family Building Society, and Precise has increased the portfolio limit for landlords to 20 properties. Properties 11 to 20 are capped at 70 per cent LTV.
Elsewhere, Coventry is the latest lender to change its rental calculations in line with the new Prudential Regulation Authority guidelines, now moving to 140 per cent at 5.5 per cent. Five-year fixed rates are unchanged.
The Mortgage Works has made some rate improvements and has two-year fixes from 1.89 per cent up to 65 per cent LTV and from 2.14 per cent up to 75 per cent LTV, with £1,995 fees.
Finally, Shawbrook has unveiled its product aimed at potential mortgage prisoners and borrowers aged 55 and over. It allows them to extend an interest-only loan over a term of five to 15 years for those remortgaging with it. It starts at a rate of 5.25 per cent with a maximum LTV of 50 per cent.
Andrew Montlake is director at Coreco