April saw significant purchasing and remortgaging activity following forecasts suggesting an interest rate rise in May, according to the Mortgage Advice Bureau’s National Mortgage Index.
Homebuyer borrowing activity remained strong throughout the month, suggesting consumers have confidence in the market, while HMRC data revealed completed transaction volumes were slightly tempered overall.
What’s more, Halifax reported year-on-year average price increases at 2.2%, suggesting an average annual increase of 0.6%. Price movements varied between indices, however, with some urban areas faring far better than others.
Outlook for the market appeared more positive. Some 31% of surveyors believe that prices will be higher in a year’s time, with the strongest sentiment in Scotland and the North West while expectations in London remain despondent, the latest RICS Residential Survey found.
“We believe the news agenda around a potential rate increase drove consumer sentiment around remortgaging activity earlier in the month, with 95.5% of those arranging borrowing on their existing home selecting a fixed rate product of some kind, a slight increase on 94.2% in April last year,” said Brian Murphy, head of lending at Mortgage Advice Bureau.
What’s more, first-time buyer activity remained consistent in April, recording a slight average uplift in purchase price. However, this correlates with the ongoing lack of available housing stock, as reported by RICS.
“Overall, we’d suggest that buyer demand has remained consistent, with the ongoing lack of available properties still at near all-time record lows contributing in no small part to a market which appears to be turning slightly stagnant in some areas,” Murphy continued.
He said a lack of available properties to buy leads to less buyer choice, and those who wish to purchase are taking longer to find what they are looking for.
“Of course, whilst this trend continues, it does at least suggest consumer confidence in property is still evident, which in the longer term is not the worst place for the UK property market to find itself in.”