Mortgage Market Comment by TMM


Market Comment

September 2011.

Mortgage Market Update.

After what has been a wet and sometimes chilly like Summer, are we going to see some warmth in the property market during Q4 of 2011 or is that market going to freeze up?

The Bank of England Monetary Committee has maintained Base Rate at 0.5% for the 30th month in a row. Following comments from the Bank about base Rate rises not being the correct tool to tackle the current inflation problems, it seems likely that rates will remain at current levels for some time. The Monetary Policy Committee voted 9-0 to keep rates at this level in August. Despite a flurry of news stories in late August and early September suggesting we might see the Base rate fall from 0.5% to 0.25%

Although this remains good news for borrowers, the underlying factors behind this vote are less appetising. Members of the MPC admitted that the economic outlook had darkened, particularly as a result of the ongoing Eurozone debt crisis which seems to worsen every day. The bank has now downgraded its growth forecasts for the second time this year and warned the UK faces serious threats from Europe's debt storms. Inflation is expected to peak at 5 per cent this year however MPC members thought slower growth prospects would reduce pressure on prices.

Samuel Tombs, UK economist at research firm Capital Economics, said: 'August's MPC minutes and the latest labour market data strongly support the markets' assumption that interest rates will remain on hold for at least the next couple of years.'

Alarm bells are ringing over the health of the housing market after Hometrack, the property data company, forecast steeper falls in prices this autumn – with the latest figures showing a 3.6% annual fall in August.

Hometrack's prediction will fuel the view of bearish commentators that UK house prices are still some way from the trough, despite falls of about 10% since their peak. Prices fell 0.1% in August for a fourth consecutive month, suggesting that the housing market has been in a temporary state of equilibrium with sellers and buyers having similar expectations over pricing levels.

Richard Donnell, Hometrack's director of research, said that price inflation in parts of London had put a gloss on the figures for the first half of the year, and that once the "London effect" was eliminated, there was less scope for optimism.

This month, figures from the Land Registry put the annual fall in house prices at 2.15%, taking the average price of a property in England and Wales to £163,049. The south-west experienced the greatest monthly rise in prices, with an increase of 2.2%, while the greatest annual price fall was in the north-east, with a decrease of 8.8%.

So, what advice for borrowers? Although it is very easy to remain on a lender's standard variable rate, of which many are in the region of 4.5%, there are far more competitive interest rates available at present with some lenders offering both 5 and 10 years fixed rates at below 4%. Not only are these schemes more competitive than many standard variable rates, they will also offer protection at the point that Bank of England Base Rate finally rises. For those who wish to benefit from a slightly lower base Rate tracker then we have access to lenders who will offer a competitive tracker rate which offers the option of switching into the lenders fixed rates, thus offering the best of both worlds.

One thing that is certain is that procuring a mortgage will remain extremely difficult with lenders declining applications for what seem like minor divergences from their credit policy. Now, more than ever, the expertise of a Mortgage Broker is required. If you recognise this issue then please consider contacting us.

To discuss your mortgage and the different options available to you please call one of the Tyler Mortgage Management Account Managers.

Our advisors with an average of 20 years or more in the Mortgage Market can help guide you to the most appropriate solutions for your next mortgage and their wealth of experience should help ease the way for you to find the package that is most suitable for you.

For more personalised comment and for advice about your own mortgage requirements do please pick up the phone and call one of our team on 020 7930 7242 or email one of us having read our profiles on the “about TMM” pages on this site.

Your home may be repossessed if you do not keep up repayments on your mortgage.

A typical fee for arranging your mortgage is 1.5% of the loan amount.

Simon Tyler, 16th September 2011.




Client Comments

“I have known Simon for 30 years. He is a thoroughly dedicated professional, and I can guarantee for any prospective client, that you will not be disappointed. He has assisted me with some tricky requests for mortgage assistance and without his help, I would never have been able to achieve my goals. I trust this man wholeheartedly, and suggest that you do the same.”
Tony Eager
International Manager – Security Industry.

“I have dealt with Simon since 1988 and helped develop IT solutions for his companies as well as receiving excellent personal mortgage advice from him as he built up his companies. Simon is unquestionably and honest and genuine person to both work with as a supplier and to receive unbiased advice from.”
Anthony Roy
Technical Director and CEO, Risk Free UK LTD.

“Simon is an expert in his field. He has provided me with sensible, effective advice on mortgages on numerous occasions.” .
Cary Zitcer
Business Owner in the Security Industry. Dealt with Simon since 1980.

“Over the years Simon has advised us on many occasions with regard to our mortgage requirements. Simon stands out from the crowd in this industry for his sheer depth of knowledge, long established relationships with mortgage providers, and general gravitas. Despite several aborted property purchases, Simon has always come up with the goods when we most needed it, and most recently, he assisted us in the purchase of what I can confidently say is my dream home, against stiff competition. Simon is also a great industry commentator.”
Alison Cork
Journalist and TV Presenter.

“I have worked with Simon for over 20 years and he has always come up with good solutions and products that are not generally available.”
Jonathan Lewis

“If you're buying a new home or ever need to borrow money cheaply and reliably, through a new mortgage, a bank loan or any other financial instrument, Simon has always been one of the best experts – and commentators.”
Journalist and Broadcaster.



Your home may be repossessed if you do not keep up repayments on your mortgage.

To discuss your current or future mortgage requirements please call 020 7930 7242.

A typical fee for arranging your mortgage is 1.5% of the loan amount.