Surprisingly, however, national brokers at least are finding that business is holding up helped by product transfer and remortgaging, although residential sales in the South East are suffering down valuations.
“There has been a reduction in activity in the purchase market, with people not confident to put property on the market, but because there are so few properties there is a buyer base if the right property does appear,” says David Hollingworth, associate director, communications, at London & Country Mortgages.
“For mortgage borrowers, rates are a good story. Amid a lot of uncertainty, the chance to lock down a very low rate is appealing and having that constant re-pricing doesn’t do any harm in terms of focusing people’s attention.
He points out that the run-up to Christmas is also a prime moment to sort out a remortgage. “Now’s the time people want to get that in place so that they’re ready for the New Year,” Hollingworth says.
A borrower’s market
At Mortgage Advice Bureau, sales director Gareth Herbert paints a similar picture. “We’re a national broker and our numbers are holding up quite nicely in October against September, with strong client retention, product transfers and a little bit more activity in remortgaging.
“What an opportunity, at the moment, in light of where rates are. If you’re a customer looking at your finances and able to do a product transfer or remortgage now’s the time to do it.
And there is strong demand from first-time buyers: “We’ve done some first-time buyer evenings at some of our high street mortgage shops and people are queuing out the door. There’s still an aspiration to own your own home,” Herbert adds.
However, continuing economic and political uncertainty is affecting confidence, particularly where there’s a threat of job losses, Herbert adds.
“You do feel that pinch as a national broker. The longer this goes on, with Brussels and letters and so on, it just continues to fuel uncertainty.”
Herbert reflects that the instability may be stressing people out, particularly in the capital.
“I happened to be on the tube when it all went off with Extinction Rebellion. I looked out of the window, saw a woman kicking a bloke on the floor and I couldn’t believe it. You don’t often see that. Tensions are high, certainly in London.
However, he adds: “There’s a lot to be positive about. There will be pent up demand and the market will increase when all this Brexit stuff sorts itself out.”
At remortgage specialists Your Mortgage Decisions, director Dominik Lipnicki reports resilience in the North, but downward pressure on pricing further south.
“The market is decent in northern areas and we’ve seen some good property price increases, but in the South, it really has halted. London, Surrey, Kent – the market is very slow, not much is shifting and prices have gone down in many areas.
“Money being cheap is one side of it and it helps, but when property prices fall you have pressure on loan to values as well.
“If you’re hoping to move up the housing ladder or purchase your next buy to let, a market where prices go down rather than up will make you think twice,” Lipnicki says.
The firm has seen remortgage transactions hold up, but with little additional borrowing.
“Would lending be higher if we didn’t have such uncertainty ahead? Would people decide to build that extension, buy that car or go on that cruise? Many people are just remortgaging like-for-like.”
In buy to let, Lipnicki adds, fear about the policies of a possible incoming Labour government is stymying some transactions.
“Buy to let landlords have taken a hammering over the past few years and some are scared it could get worse if we have a Labour government. A lot of people are waiting to see what will happen,” he says.
While the London market is suffering most, even here Help to Buy continues to buoy sales.
“In new build, anything in Help to Buy is absolutely no problem. But above that, from about £600,000 to £1.5m, there are fewer buyers and a lot of stock,” says Lee Pendleton, chief executive of estate agency James Pendleton.
A softening of consumer confidence has dented residential transactions, with sales at the firm down 25 per cent by volume on last year and prices on average 15 per cent lower, and in some cases down as much as 20 per cent.
“You’ve got to be realistic with prices. We’ve seen some significant down valuations when someone is having a mortgage valuation done. The banks are being very cautious that everything has to be backed up on a valuation with properties comparable within the last three months,” says Pendleton.
“Although you have to remember that prices have gone up by 200 per cent since our business started 17 years ago. The market cooling price-wise is a good thing and makes it more realistic,” he adds.