The stamp duty holiday is continuing to ramp up demand in the property market, with mortgage approvals soaring to a 13-year high in September. However, will this trend continue during the current lockdown?
September saw a total of 91,500 mortgage approvals, the highest level since September 2007. These numbers are slightly higher than August 2020, where 84,700 mortgages were approved.
This increase is due to two factors, the government’s stamp duty holiday announcement and the fact that many people are reassessing their housing needs following the first coronavirus lockdown. In numbers, this means that October saw a sales growth of 53% in comparison to the same month last year.
Sales are at an all-time high due to the demand that built up during the first national lockdown and with many continuing to work from home and reassessing their living requirements. The stamp duty holiday announcement has also driven more homeowners to move to a new home, due to the savings, which can be made on properties up to the value of £500,000.
However, with the current lockdown in place, it is expected that delays will happen in the conveyancing process. It’s estimated that only 54% of agreed sales in January will be completed by the end of March, in comparison with the 92% of those agreed in November.
Banks have also lowered the number of mortgage products available, and although they are continually reassessing the situation, only halve of the mortgage products are available in the market in comparison to last year. According to Moneyfacts, only a handful of deals remain for people with a 5% deposit, and around 50 mortgage deals for those with a 10% deposit.
There has also been an increase in rejections for first-time buyer applications, as lenders are more risk-aware. However, the government is looking at ways to work with lenders to make more deals available for buyers with smaller deposits, to drive more people to own their property since the 1980s.
Going forward, the property market will remain strong in some areas where buyer appetite outweighs available properties for sale.
If you are looking to buy or sell your property, speak with one of our property experts today by calling us on 0116 275 8888.
#PropertyNews #MortgageApprovals #PropertyMarketReport #PropertySales #Danvers