Property prices rise by 12% & remortgage applications up by 17%

 

At the time of writing, property prices are up 12% over the last 12 months, according to the ONS House Price Index.

Data released by Mortgage Advice Bureau (MAB), shows that homeowners have greatly benefited from improving housing equity, with those seeking to remortgage having 26% more equity when compared to 12 months ago.

Remortgage applications also rose by 17% since September, suggesting equity gains are prompting more homeowners to seek a better mortgage deal.

However, a gradual cooling of house price growth (ONS data shows a monthly increase of just 0.5%) has also reassured many consumers they can still afford to buy with purchase applications rising 11% since September and 17% since October 2013.

As a result of these significant increases in both remortgage and purchase activity, monthly loan applications reached the highest point of the year in October.

Brian Murphy, head of lending at Mortgage Advice Bureau comments: “House price growth has often been billed as a cause for concern over the last year, but for many of the UK’s homeowners – including more than 11 million mortgage holders – the recovery has delivered a long-awaited boost to their housing equity.

“Recovering property values are giving many people the leverage they need to negotiate a better mortgage deal with lower monthly repayments, so it’s unsurprising that remortgage applications are rising as a result.

“However, it is important that the industry does not become complacent and forget its responsibility towards first-time buyers who are not able to save for a hefty deposit.

“Widespread availability of higher loan-to-value (LTV) products on new builds as well as existing properties will be vital to give potential buyers the leg-up onto the property ladder they need.”

This article was kindly contributed to Pace by Paul Flavin, of Zing Money. It is Paul’s belief that good financial advice should be available to everyone & that by simplifying the mortgage process you are able to make an informed choice through greater understanding.

Paul places great emphasis on customer service & always seeks feedback on how to best improve this area. “Making a house purchase or remortgage as painless an experience as possible for you is my objective”.