Low rates and summer resolutions makes September the month to act
This time last year, the financial world was waiting to see what the effect of the Brexit vote would have on mortgage sales. With many predicting that the uncertainty would take its toll on the housing market.
As it turned out, such worries proved to be unfounded, with the market continuing to grow and mortgage sales continuing to rise, a trend which has continued into this year as well.
I am generally an optimist and believe that the link between national and international events on people’s buying behaviour is often over-estimated. People consistently strive to own their own home and they will continue to seek to climb the housing ladder as they look for a property which matches their personal circumstances, be it a growing family or a job relocation.
One national event which will have an effect, however, is a change in the Bank of England’s base rate. This, too, has been the subject of much speculation. However, the Bank has defied many people’s expectations by continuing to set its base rate at the lowest level in its history, 0.25%.
This is great news for new house-buyers, who are able to take advantage of some excellent deals. This makes it easier to buy the house of their dreams. But also for existing home-owners who can save hundreds of pounds by switching to a new deal.
Figures from this year show that remortgaging is now taking a leading role in the mortgage market. With more remortgagers securing deals than first-time buyers, whether for their own home or a buy-to-let property.
I would predict that this trend will continue. Especially at this time of year when we get an influx of inquiries. Mainly from customers who decided while on their summer holidays that they wanted to sort their finances out once and for all. Or even make that long-awaited house move.
This happens every year – it certainly keeps us busy in September. But I am surprised that we don’t get more remortgagers picking up the phone. An estimated 1.2m UK homeowners are paying more than they should, according to Citizen’s Advice. This is because they haven’t switched to a better deal and instead are paying their lender’s higher variable rate.
What makes this even more important is that those low-interest rates won’t last forever. No-one knows when the base rate will rise, but my advice, to make September the month you take action. Especially since there are currently more mortgage products than ever on the market.
My other advice is to get advice. Resolving to sell your home or remortgage is one thing, going through with it properly is another. If these do prove to be once-in-lifetime rates, then it’s important to make sure you get the right one for you.
The best way to do this is to get a professional on your side. Especially one who is totally independent and who can access the whole market when it comes to getting you a deal.
If you would like more advice or more information ring Finance Advice Centre on Freephone 0800 103 2655 or 01332 821 340. Alternatively, fill in the form to the side of the page and we will call you.