Once again the housing market has surprised. The final full month of summer revealed that the house prices have tipped upward in August. Despite the overbearing flood of reports of uncertainty of the upcoming deadline of Brexit on 31 October, hopeful home buyers took action and grabbed the opportunity present in today’s market.
The housing market has remained resilient throughout the lead up to Brexit this year. Rather than the doom and gloom some experts forecasted, there have at times been surprising reports with data revealing hopeful home buyers were not to be deterred. With low interest rates, long term deals, lower asking prices, and in some areas more inventory of homes to shop, home buyers were treated to a very inviting market. One particular type of home buyer, the first time buyer, has been the most active.
The latest report from Nationwide for August revealed that homebuyers have become more cautious as the Brexit deadline of 31 October nears. The report showed that the average house price fell to £216,096 which is £1,567 less than last month. Experts believe that the market will continue to show signs of weariness in the weeks to come.
A major number of homeowners will have their mortgage deal end in the lead up to the Brexit deadline of 31 October. Once their deal ends they can choose to remortgage or they can choose not to and their lender will move them to the lender’s standard variable rate (SVR). That could be a financial nightmare for homeowners because there are, according to experts, some SVRs that are at an interest rate level of double or more what the homeowners are used to paying.
The mortgage lending pool became one less when Tesco Bank decided to leave the mortgage market. It was recently announced that they sold their entire mortgage book to Lloyds Banking Group in a deal worth £3.8 billion deal. The initial announcement about Tesco Bank abandoning the mortgage lending market came in May. The loss of possible profit margins was the reasoning. It left those with mortgages wondering what would happen and who would become the new owner of their mortgage debt.
The month of September has begun and that puts the Brexit deadline in under sixty days. The 31 October deadline is going to come quickly and with it there will be unique opportunities that will likely be short lived. Because of those unique opportunities, it is expected that there will be surprising boosts to the housing market. There could also be boosts to the lending market as hopeful home buyers seek mortgages and homeowners secure remortgages.