First-time buyers and existing homeowners capitalised on low rates across the mortgage market in October, according to e.surv.
The surveyor’s Mortgage Monitor recorded 67,011 mortgages approved during the month of October (seasonally adjusted). This figure is 2.7 per cent higher than September’s approval figure and 3.5 per cent up on October 2017.
E.surv says that despite the Bank of England base rate being raised at the start of August, mortgage rates have remained comparatively cheap, tempting more borrowers into the market.
E.surv found the mortgage market has continued its recent shift towards buyers with smaller deposits (15 per cent or less of the property value), with a slight increase in lending to this group in October. Some 24.6 per cent of all loans went to this segment of the market in October, higher than the 24.2 per cent recorded in September.
In October, 29.6 per cent of all loans went to borrowers with large deposits (40 per cent or more). This figure is lower than the 30 per cent market share recorded in September. It is also lower than the 32.5 per cent recorded in August and even further from the 33.8 per cent seen in July.
e.surv director Richard Sexton (pictured) says: “Borrowers with smaller deposits, including many first-time buyers, saw their market share increase this month. This continues the broader market trend towards these borrowers and away from those with larger amounts of cash.”
e.surv predicts that transactions are likely to tail off as the year comes to a close, as buyers prefer not to move close to the Christmas period. However, those existing homeowners looking to remortgage may swoop to grab a cheap mortgage deal while they last.
“Most agree there appears to be little prospect of another increase in the Bank of England’s base rate between now and the end of the year, yet that is no reason for potential remortgage customers to halt their search,” says Sexton, “With rates still at historically low levels across the board, there are great deals to be found at both high street mortgage lenders and more specialist banks.”