That was the year that was! Enzo Mora of The Mortgage Brain
16th December 2022
In his last business expert column of the year, Enzo Mora, CEO and founder of The Mortgage Brain looks back at 2022 and what next year has in store for all things property.
We end the year with a not so jolly present from the Bank of England, deciding on the ninth consecutive rise in the bank base interest rate in a year to 3.5 per cent.
The good news is that hopefully this is the peak and there is less chance of further increases in 2023. Inflation dropped marginally this month to 10.7 per cent in a sign that it too will fall back next year, although there is some way to go to the heady days of the government's target of two per cent.
Most lenders have priced in rises for fixed rate mortgages for now, but some tracker rates will of course rise, although they are more competitive at present. While we know as a mortgage broker that we can still secure home loans, potential movers reading the headlines could feel less confident of the market in general.
Let's get used to a more normal property market
Talking of headlines, we're trying to banish the doom and gloom. While property prices aren't rising as fast as they were for the past two years, and that was unsustainable, they are still rising!
Rightmove's latest research reveals that asking prices end the year 5.6 per cent higher than a year ago. The frenetic activity we had all slightly become used to will settle back to a more normal market and a more even balance between supply and demand for property, with no sign of forced sales that would contribute to price falls.
Are you caught between a rock and a hard place?
Meanwhile, if you're renting and trying to save hard for a deposit, you could find you will be paying more in rent, especially if you have to start a new tenancy. Zoopla's latest Rental Report shows that annual rents in the UK have risen by 12.1 per cent, or £117 per month, and stands at 35 per cent of average weekly earnings! That's hefty.
However, our advisers are skilled at squeezing every last drop of income to count for a mortgage, so do have a conversation with us at the earliest opportunity.
We can suggest lots of ways to help you get a mortgage from 5 per cent deposit schemes to those that allow friends or family to become deposit or income boosters. We will get you on the ladder somehow and save you paying someone else's mortgage!
Help from lenders and stamp duty savings
Good news from lenders as they have agreed to be more flexible for borrowers affected by the rising cost of living, by supporting homeowners who run into difficulties.
These could include short-term reductions in repayments and mortgage term extensions. If you're up to date with mortgage payments, you may be able to switch to a new mortgage deal without having to do another affordability test. Once again, we are the experts so ask our advice.
The stamp duty savings announced this year will stay in place until 31 March 2023. So for first-time buyers there is no stamp duty to pay on a home costing up to £425,000, and the nil-rate tax threshold for other buyers, except second homeowners, is £250,000. This will help thousands of people save a bit more money.
Let's banish the Grinch this Christmas and stay positive, just like Cinders going to the ball, you will get on the ladder sooner or later with our help at The Mortgage Brain. Happy Christmas to you all.
To find out more about The Mortgage Brain, visit www.themortgagebrain.net or call 0333 340 8888.
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