Analysis by Andrews Mortgage Services - a core business within the Andrews and Partners Group, has shown that mortgage submission over the past four months are actually up by 47 per cent when compared to the same period in 2006.
This is despite the previous interest rate rise of 0.25 points on the 11th January 2007 and rates now being set at 1 per cent higher than during the first quarter of last year.
“Most lenders anticipated a rise but with an influx of properties hitting the housing market in the run up to HIPs (Home Information Packs) on the 1st June, the property market has remained very active with the average property selling after just 72 day*” said Chris Chapman, Andrews Financial Services Director.
Further analysis of Andrews data showed that 87 per cent of the mortgages submitted since 11th January 2007 have been on a fixed rate basis which given the current climate, will come as know great surprise. Perhaps more surprising however, is that this percentage is exactly the same as the January to May period, 2006.
“With property prices continuing to rise, a larger proportion of buyers’ income is now being used to pay for a mortgage. This is normally five times that of the buyers’ salary so many chose the more affordable fixed rate so they can ensure the same outgoings each month. In the past two weeks alone we have seen fixed rate products increase by 0.25 per cent”, said Mr Chapman.
So whilst all may be well for the ‘fixed raters’ out there, how will the rise effect those with fluctuating mortgage payments?
“No increase will ever be well received – this goes without saying, but it is important to remember that this latest announcement represents just £4.00 more per week on a typical mortgage of £100,000”
“And if borrowing costs to begin to bite, with access to over 4,000 different mortgages, Andrews can source the most appropriate and competitive product for every individual, which so far has not dampened home buyers spirits in the least”, concluded Russell Clark, Area Sales Manager.
