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Thursday, July 18, 2024

Unlocking the UK Mortgage Approval Outlook: Expert Questions and Answers

Mortgage approvals in the UK have been on a decline, raising concerns among current and potential homeowners. Open Property Group has delved into the current state of UK mortgage approvals, seeking insights from industry experts. Here’s what the experts had to say:

Question 1: Do you forecast an uplift in UK Mortgage Approvals within the next 12 months?

Ben Grey from CHN Financial Consultancy is pessimistic, noting that there are issues not only for applicants but also for valuers. Surveyors are being cautious, leading to challenges for buyers who may need extra cash or renegotiations.

On the other hand, Mark Hansard from First Financial holds a more optimistic view. He anticipates an approval uplift due to higher acceptance of slightly higher interest rates. The market has a surplus of properties, thanks to Buy-To-Let landlords selling their portfolios, which could benefit first-time buyers.

Question 2: Have you spotted any Mortgage Approval patterns across specific regions?

Ben Grey suggests that strict valuations are more prevalent in areas where house prices have experienced recent inflation, particularly in higher-value regions.

Question 3: Have you spotted any Mortgage Approval patterns based on property type?

Wayne Hill from M&G Mortgages observes that, in their transactions, more people are leaning towards flats rather than houses. This trend may indicate changing preferences among buyers.

Question 4: Have you spotted any Mortgage Approval patterns based on first-time or second-time buyers?

Wayne Hill notes that there is a higher number of approvals for first-time buyers compared to second-home movers. Existing homeowners seem cautious about taking the next step due to increased mortgage commitments and rising interest rates.

Mark Hansard from First Financial discusses the ‘new normal’ in mortgage lending, mentioning that some lenders are offering increased income multiples for higher earners and allowing more clients to opt for interest-only mortgages if they have a suitable repayment plan. He believes that first-time buyers adapting to interest rates between 3% to 4.5% may not be a negative development.

Open Property Group, experts in helping homeowners sell their properties quickly regardless of market conditions, suggests that despite ongoing uncertainty, there is a growing understanding of the ‘new normal’ in terms of interest rates compared to a year ago. Market conditions vary, but the outlook appears to be more bearish than bullish.

For the full Expert Commentary Q&A, you can visit https://www.openpropertygroup.com/landlord-hub/uk-mortgage-approvals/

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