Mortgage market ends 2018 with a “flourish”: MAB

The Mortgage Advice Bureau’s December report describes a positive end to 2018, even finishing with a “flourish” in some regions, with major indicators stable.

In the residential purchase market, the average property price was mostly flat, dipping 0.3 per cent to £241,341. On an annual basis this was 2.9 per cent lower than last year’s average price of £248,637.

Meanwhile, in the residential remortgage market, the average property value increased by 1.2 per cent, from £303,995 to £307,660, also down 2.9 per cent compared to December 2017, at which point the average price was £316,928.

There was barely any change in the BTL purchase category: in December 2018 the average price was £185,133, close to November’s figure of £185,857, and yet closer to December 2017’s £185,273.

On a monthly basis, the average first-time buyer purchase price tells a similar story, coming in at £204,228 compared to £204,927 in the month previous. Compared annually there is more dramatic change: a drop from £212,904, or 4.08 per cent.

The MAB report also shows significant change in the average FTB purchase salary. In December 2018 this stood at £30,788, 1.25 per cent less than the month before, when this figure came to £31,179.

In December 2017 the average salary for FTBs was £31,645, providing a yearly drop of 2.70 per cent. The ONS reports that within that time frame, inflation ran at 3.21 per cent.

When the overall market is split into regions, the MAB report shows that Wales, the South West, the North East, East Midlands and East of England all saw a monthly increase in average purchase loans, while Scotland, the North West, the West Midlands, Yorkshire & the Humber, the South East and Greater London all dropped.

Mortgage Advice Bureau head of lending Brian Murphy says: “The UK high street may have been quieter than anticipated prior to Christmas, but the property market in December appeared to exceed seasonal expectations in some parts of the UK, with regions such as the East and West Midlands, Yorkshire and the Humber and Wales ending the year with a flourish.

“As such, we’d suggest this highlights the disaggregated environment that has been in evidence for most of 2018; the market has been highly nuanced for some time, with dynamics between price points as well as overall market activity varying between the major conurbations, even within the same region.

“With the major lenders, such as the Halifax and Nationwide house price indices reporting positive movement in average values for December, as well as HMRC returning a steady level of transactions, it’s possible to suggest that this supports what many of our advisers in our network saw ‘at the coal-face’ last month, which is that regardless of the ongoing Brexit-driven headlines, consumers both need and want to get on with their lives, and that the motivations and aspirations to move home are still, for the most part, in evidence.”

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