Purchase values up 12% while remortgage values drop, research shows

Despite Covid-19, the average mortgage value for purchasers is up 12.4% compared to the same period in 2019, according to data from MCI Mortgage Club and eKeeper.

Average mortgage purchase values have risen from £202,058 at the end of August 2019 to £230,768 now, while the average remortgage value has dropped 11.11%, down to £166,954.

The picture for the year from January until the end of August illustrates just how robust the UK mortgage market is, with an average growth of 4.46% for purchase mortgages, compared to the same period a year ago.

However, there’s a trending decline of 3.7% for remortgage values across the year so far.

This comes at a time that traditionally sees values fall away as competition diminishes when people go on holiday.

July and August saw a return to normal service for purchase mortgages following the announcement of the stamp duty holiday, and the release of pent-up demand after a slump in purchases in April and May due to lockdown.

The combination of data also found that case activity by advisers and administrators continued to grow, matching 2019’s figures and remaining steady during ‘holiday dips’ during August, with an average of 55,000case interactions per week compared to 46,700 in August last year.

Melanie Spencer, head of MCI Mortgage Club, says stamp duty holiday and pent-up demand following lockdown has stimulated the market, with rising property prices being driven by an increase in demand to move home.

She comments: “These demand factors are paired with the low cost of borrowing but a limited supply of high LTV products. We know that lending criteria is tightening so not all demand is being met, but brokers still continue to service their clients within challenging market conditions.”

eKeeper’s customer relationship management (CRM) system recorded the number of diary appointments brokers made with clients wanting mortgage products. This rose above the historical average by 3% in July and August.

Surprisingly, appointments with brokers for protection products fell by 9% following continued growth since the beginning of lockdown.”

Spencer adds: “Mortgage appointments provide comfort that brokers are building a pipeline of activity into the Autumn, although a drop in appointments for protection emphasises the need for brokers to proactively contact their clients about this vitally important area of business.”

“This comes at a time where remortgaging and low-interest rates afford a prime opportunity to engage. Of course, protection is about more holistic advice outcomes for consumers, especially vital during these rocky times.”

OneAgency have seen an increase in home movers looking to secure their next home, in Stoke-on-Trent. It would seem that there is no better time to make you dream of moving come true. Why not contact one of our property experts to discuss you sale.

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