Archive for 2009

The Bank of England has just announced that it is keeping the base rate at 0.5% for the sixth month in a row. It is widely expected that the rate may stay this low for at least the rest of the year. Despite this, mortgage deals are still only available at around 4% on fixed rate options, and you need a 25% deposit to secure the best deals.

The Bank of England has just announced that the base rate will stay at its historic low of 0.5% this month. Whilst this is generally good for people on variable rates, new fixed rates deals are still hovering above 4% even with hefty deposits. Since the base rate can only really go up from here, and is likely to before long, it is unlikely that fixed rates will get any lower.

Latest figures from the HMRC show that 60,000 homes (worth over £40,000) were sold in March, compared with 43,000 in February. Whilst sales in March would normally be expected to be higher than February, the increase is still a sizeable amount on seasonally adjusted figures, i.e. 54,000 in Feb to 61,000 in March or 13%. This might come as good news for those looking to move in the near future, but obtaining a mortgage is still much tougher than it was just a few months ago. The Council of Mortgage Lenders reports that in February, first time buyers had to put down an average deposit of 25%. With the average first time buyer loan being £95,000, that means an average deposit of just under £32,000 – a significant amount for all but the most affluent buyers. The CML also reports that 2 million households would be unable to move now due to negative equity or inability to raise a deposit on a new property.

Figures from the Bank of England show that mortgage approvals saw a surprise increase in February, rising to almost 38,000, from less than 32,000 in January. The increase is a positive move back towards a more active property market. However, it is still well down on what would be considered normal levels of activity. Normal levels would be around 70,000 mortgage approvals per month.

Figures released from the Land Registry show that property prices fell by 2% in February. This means the annual rate of decline increases from 15.1% to 16.5%. The average house is now worth just under £154,000, more than £30,000 less than a year ago. Decline in house prices in the North West was significantly higher than average, with house prices dropping by 4.1% in February. However, in the South West, prices dropped by only 1%. Figures for London show that property prices dropped slightly less than the average over the last year, falling by 15.6% to £298,563. Sales have also dropped significantly over the last year. There were 81,300 completions in December 2007, but only 36,341 in December 2008.