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Stable national figures hide stark regional differences – Mortgage Advice Bureau

  • 28/06/2019
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Stable national figures hide stark regional differences – Mortgage Advice Bureau
The value of loans taken out for purchases and remortgages in May both grew compared to April but are more mixed compared to last year, Mortgage Advice Bureau (MAB) has reported.


The broker firm also noted that buyers and sellers in many parts of the country had given up waiting for Brexit and decided to get on with their plans since April.

According to data from MAB, the average purchase loan was £176,903 in May, up 1.6 per cent on April and also 0.8 per cent higher than May 2018.

However, while the average remortgage loan of £177,085 last month was up 0.8 per cent on April, and down 1.1 per cent from May 2018.

A similar pattern was seen in the property values being bought or remortgaged, the broker firm reported.

The average purchase price of £248,237 in May was up 1.7 per cent on April’s £244,127 total, but a slight decrease of 0.7 per cent on May 2018.

Average remortgage property values in May were basically unchanged from April at £309,982, but down by 3.6 per cent on May 2018’s total of £321,580.

The buy-to-let (BTL) market also mirrored this pattern, with the average BTL purchase loan of £124,182 in May up 0.97 per cent on April, but down 1.8 per cent on May 2018.

And the average BTL purchase price was £176,901 in May, which is down 6.4 per cent from May 2018’s value of £188,909.


Stark regional differences

MAB head of lending Brian Murphy (pictured) suggested the more stable national picture was starting to hide far more stark differences across the country. (See map below, courtesy of MAB.)

“In some areas of the UK, notably the Midlands, Wales, North West, Yorkshire and Humberside, market confidence is still strong, with demand often outstripping supply at some price points,” he said.

“This has, understandably, translated into increased numbers of clients requiring purchase mortgages in these areas.

“Likewise, in these regions, year-on-year price growth is notable, meaning that those who are trading up to a more expensive property, or indeed staying put and remortgaging, are in many cases benefiting from the increased amount of value in their current property.

“However, these areas are balancing out those which are seeing softer conditions, meaning that when viewed collectively, national average price movements on both a month-on-month and year-on-year basis are more subdued,” he added.


Enough of Brexit

The firm also noted that in some regions people had decided over the last couple of months to stop putting plans on-hold for Brexit.

“It would appear that many first-time buyers and home movers have decided over the past few weeks that, whilst they may have previously delayed their moving plans due to Brexit, they simply aren’t willing – or in some cases, able – to wait any longer,” Murphy continued.

“It’s this carry on regardless sentiment in the stronger performing parts of the UK that appears to be keeping overall purchase levels ticking over at a steady pace, with the better performing regions counterbalancing the lower levels of activity in other regions.”

MAB also flagged the continued market competition with some larger brands re-pricing downwards last month, noting that this approach was likely to be “indicative of the lending landscape over the next few months.”




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