In the latest release of the HM Land Registry, we were reminded that even the data compilation of UK House Price Index has not been free of impact from the pandemic. The data released is accurate, but revisions may be made as more data becomes available. Currently, like other house price reports, the Land Registry report is showing an increase in the average house price. August data revealed that there was a 2.9% increase over July. The annual price increased by 10.6% making the average UK house price £264,244.

Homeowners have a variety of remortgage products available to choose between from lenders and brokers. The competition for borrowers has led to lower interest rates and creative offers to gain their attention. In just the past weeks, more and more deals at 1% or less interest rates have come available. It would seem the choice would be straightforward as to which deal should be chosen, but there could be much confusion, especially between the choice of a fixed rate deal or one with a variable interest rate. 

For the first time since 2007, asking prices in the UK housing market rose for all regions. Buyer demand is still strongly outpacing supply and that is pushing housing prices upward. Month after month since the pandemic began, buyers have been seeking homes with more space and those that fill the unique needs for their pandemic lifestyles. This has helped push up asking prices in areas often less popular such as those in the rural countryside. 

The ability to save money and pad one’s household budget is usually always at the top of the list when it comes to making a financial choice. It is even more so when the economy could be viewed as unstable due to circumstances outside of the normal. If no one can predict an outcome, then no one can truly predict the economic impact. The global pandemic’s impact on the UK economy and therefore individual households was entirely out of focus for those that could precisely say what was to come a year ago or even now.

Homeowners have been known to simply let the opportunity to remortgage slide. At the end of their mortgage term, rather than remortgage, they simply allow their loan to be moved to the lender’s standard variable rate or SVR. However, with interest rates from lenders reaching historic lows, fewer homeowners are letting their mortgage deal lapse to a SVR, in fact, many are choosing to remortgage before their current term ends to take advantage of possible savings.

Interest rates are at an historical all-time low. The current standard base interest rate set by the Bank of England’s Monetary Policy Committee (MPC) is at the lowest rate in over 300 years. In fact, it is the lowest it has ever been. Lenders are offering deals on mortgages and remortgages that are below 1%. Borrowing is cheap and lenders are competitive to get the attention of those looking to take advantage of the opportunity in saving money while borrowing.