Home owners are encouraged to take notice of their current mortgage status and their interest rate. Some may have allowed their mortgage deal to end and are unaware that they have been moved to their lender’s standard variable rate (SVR). If so, they could be paying much more than they need to on their repayments.
The housing market has continued to surprise experts. Rather than succumbing to the gloom and doom forecast of many experts due to Brexit and then its delay, the housing market has remained resilient. That resiliency could have a lot to do with the continued low interest rates connected to mortgages, lower housing prices, and more assertive home sellers ready to make a deal. First time buyers have in fact been returning to the housing market at levels unexpected.
Two years ago, the country voted to leave the EU in an historic vote known as Brexit. Since then, many sectors within the housing market have slowed down in activity due to uncertainty about what will happen following the official day. Although many are hesitant regarding their next property decisions, there are many who have followed other paths and chosen to go forward with remortgage options which are currently available. Those obtaining new mortgage deals are typically finding lower interest rates, low administration fees, and quite a competitive lender climate.
In November 2017, the Bank of England’s Monetary Policy Committee (MPC) voted to increase the standard base interest rate from the historic low of 0.25% to 0.50%. While the increase could seem minimal, consider that in one move the rate doubled. Then again in August 2018 the MPC increased the standard base interest rate by 0.25% once more taking it to a level of 0.75%. That meant that the rate was at the highest it had been since 2009 and it was triple the level seen in the greater part of 2017.
Homeowners that obtained a mortgage just a few years ago benefitted from low interest rate choices. Perhaps the lowest interest rates they will ever again have a choice of and as long as their mortgage term is active they will continue to benefit from the low interest rate. However, once their term is over they either must remortgage or their lender will move them to what is known as the lender’s standard variable rate or SVR. In comparison to the interest rates of two or more years ago to today’s SVRs the rates could be vastly different.
In recent years, the housing market has seen its share of increases in property values, stamp duty, and purchases by the first time buyer group. The market has been filled with opportunity for the everyday investor to find properties offering strong returns in the future. The buy to let market has also been strong, offering landlords and others a chance to build an attractive portfolio. Although Brexit has stifled activity a bit in the last eighteen months, it is still a space which holds promise and optimism. Recent data suggests a slowdown in house sales could mark a great time to consider remortgage.