A market survey carried out by financial resource website Moneyfacts, states that fixed rates are at the lowest levels since the product type’s inception in 1989. On average, it is now possible to secure a fixed rate at around 4 per cent, with previous averages over the past 5-10 years ranging between 4.5-5.5 per cent.
As part of new plans to be unveiled during the Liberal Democrats spring party conference, Vince Cable was questioned this week on the news that the party are considering championing a super tax on second property holders. The plan would be to implement an annual charge to those with additional properties to their home above the value of £2 million, including buy to let owners that hold a portfolio above this sum.
It has been revealed today that the Treasury is in initial talks with mortgage lenders and banking trade groups to try and implement an acceptable process for wide-spread lending at 95 per cent loan to value. The formation of the strategy is to assist banks in lending higher risk loans, by introducing mortgage indemnity guarantees to safe guard against the risk of lending with smaller securities to back the process.
The Bank of England have again decided to maintain the status quo with the underlying rate of interest in the UK, as well as pausing with any further economic stimulus via quantitative easing. The economy continues to show signs of a sluggish recovery, as Bank of England and Government initiatives take hold to kick-start the housing market. It appears that the positive news will continue for contractors looking to enter the housing market, which is good news for the new man at the top.
New figures from the Bank of England show that UK mortgage approvals have risen to the highest level in almost one year, suggesting that the government’s Funding for Lending Scheme is fulfilling its goals of boosting the mortgage market by making more money available to home buyers.
Over the past 12 months, the introduction of the government and Bank of England’s Funding for Lending scheme has attributed to steady drops in mortgage rates across the market. It’s perhaps too early to say that the scheme has been a resounding success, but the chance for lenders to access cheaper funds to pass savings to borrowers has encouraged competition and added some stimulus to the ailing sector.