The mortgage market paints a very static picture this month. The amount people wanted to borrow in April compared to March altered by just 0.25%, although of course this hid a myriad of differences across the country. There was a large range of 13% between the fall of 6.35% in London and the rise of 6.6% in the Midlands.
The average amount borrowed is identical to this time last year. In January, mortgage seekers wanted to borrow 4.5% more than the same time in 2009, as the market showed definite signs of recovery. The market indicators were positive from the start of 2010 until this month, but now the increases have slowed dramatically. April’s average borrowing is £134,500, just 0.3% more than a year ago.
The number of leads generated was affected by Easter – at this time of year there is always a slight drop in the number of borrowers looking for mortgage advice. But this year there is also the Election factor, as people delayed changing their mortgage until after polling day.
Because of this drop in borrower numbers, the amount of money that leads were selling for rose slightly, but this was marginal and with regional variations.
Across the country, there was almost a mirror image, with half of the UK seeing drops and the other half seeing rises, virtually cancelling each other out.
The most significant falls were in London. The 6.35% drop in the amount people wanted to borrow cancelled out almost exactly the same rise in March, taking London’s average borrowing back to where it was in February at £208,500. At the same time, the number of borrowers looking for advice in London also dropped quite sharply. Again, this looks like it may be the Election factor, as this is quite an unusual drop for London.
Interestingly, rather than increasing the price of leads as is normal, the price of leads in this region also dropped – and by a significant 9%.
Wales was the only other region to follow this pattern, with a 4.74% drop in the amount people wanted to borrow, a drop in borrowers and a 5% drop in lead prices which is particularly unusual.
The Midlands saw the biggest rise in the amount that people wanted to borrow, with requested borrowing increasing by 6.6% and lead prices also on the up. Northern Ireland was the anomaly, as always, due to its small population – borrowing amounts remained almost the same but lead prices went up by a mighty 16%. However, we expect that to normalise again next month.
Borrowing in most of the Southern regions either remained almost static or in the case of East Anglia rose by 4.5%. Lead prices have remained stable in most regions though, helping advisers to budget their marketing expenditure.
Next month’s picture will be an interesting one, as the aftermath of the Election will play a significant part. We expect borrowers to remain hesitant as they wait to see the effect of a new Government, and as a result the demand from advisers for the fewer leads available will rise.
Grant Stevens is managing director of Leadbay
Scotland
Av. mortgage: £108,204
Av. lead price: £13.39
Market share: 7.95%
North East
Av. mortgage: £104,016
Av. lead price: £12.21
Market share: 13.79%
N. Ireland
Av. mortgage: £112,805
Av. lead price: £13.13
Market share: 2.16%
North West
Av. mortgage: £113,038
Av. lead price: £12.62
Market share: 12.31%
Midlands
Av. mortgage: £116,995
Av. lead price: £12.99
Market share: 12.69%
Wales
Av. mortgage: £107,549
Av. lead price: £12.29
Market share: 5.09%
East Anglia
Av. mortgage: £146,619
Av. lead price: £12.37
Market share: 11.44%
London
Av. mortgage: £208,443
Av. lead price: £11.57
Market share: 7.99%
South Central
Av. mortgage: £166,147
Av. lead price: £12.36
Market share: 9.94%
South West
Av. mortgage: £132,209
Av. lead price: £12.29
Market share: 7.88%
South East
Av. mortgage: £166,509
Av. lead price: £12.32
Market share: 8.76%
