During 2021, housing prices rose faster than at any other point over the past fifteen years with an average increase of 10% in the space of 12 months, according to the latest figures from the Office for National Statistics. That means buying a house is far more expensive than it was even just 12 months ago, even though the last two years have been spent under a global pandemic.

Despite the Bank of England increasing base interest rates in December from 0.1% to 0.25%, mortgage rates are still relatively low thanks to lenders offering sub 1% mortgage deals in the recent years to entice new customers. Off the back of this the house market still seems to be thriving. This means that borrowing money is more affordable and is pushing up housing prices. However, with another rate rise looming and the effects of Omicron still to be felt, there is concern that the current economic climate might have an adverse effect on the housing market. Add in rising inflation and the cost of living and these factors are likely to directly contribute to lenders increasing their own rates and it will become harder to find a cheap mortgage deal and become more expensive to borrow money. Fewer loans will create a reduced demand and house price rises will slow down.

So, can we expect this to be the case in 2022?

Russell Galley, Managing Director of Halifax believes there may be some uncertainty over rising house prices in 2022 “Looking ahead, there is now greater uncertainty than has been the case for quite some time, with interest rates expected to rise to guard against further increases in inflation,”

“Economic confidence may be also be dented by the emergence of the new Omicron virus variant, though it remains far too early to speculate on any long-term impact, given insufficient data at this stage, not to mention the resilience the housing market has already shown in challenging circumstances.”

This uncertainty over how the house market is going to play out over 2022 has been broadly echoed elsewhere, but with first time buyers and a strong job market still pushing up sales, any decrease in housing prices are likely to be a slow decline rather than a significant drop.

Despite the expected flattening out of the housing market, you can currently still get a sub 1% mortgage deal, although admittedly only for those borrowers with huge deposits. But whilst mortgage deals are still low, even if house prices are not, we would advise that now is the time to get a good deal rather than waiting to see if house prices will come down. If you can afford to buy, we recommend you do so.

Given all the outside influences on the housing market, mortgages can often seem confusing, especially when trying to work out what will be the most cost effective deal for you and your circumstances. There are also specific lending factors to consider, such as the size of your deposit, the type of loan, your credit score and length you would like your mortgage for.

If you are interested in buying a house this year or are thinking of remortgaging, then it is worth speaking with a mortgage broker, such as Property Link Homes, who are qualified to not only answer any questions you have, but help you get the best deals out of the current housing market. It may look like a sellers’ market out there, but there are still good deals available and a mortgage broker can find you exclusive offers you may not get elsewhere.*

If you want to get the best deal without spending valuable time searching for and evaluating each lender, Property Link Homes can help. With access to hundreds of exclusive deals, we can help you find offers that are specifically tailored to your needs.  

Don’t waste time, get a better deal on your mortgage with us. Please contact us today.

*As a mortgage is secured against your home, it could be repossessed if you do not keep up the mortgage repayments.

As current deals come to an end and mortgages mature, January has seen a rise in remortgages, with borrowers seeking the benefits of lenders offering new deals to the market.

However, due to the Bank of England’s December interest rate hike from 0.1% to 0.25% in response to rising inflation, there has been a direct reflection within the mortgage market and the cost of fixed rate deals has seen a slight rise, taking all fixed rate mortgages above the 1% threshold. As they are rising from a low rate, the impact may not be seen as a direct problem, however, those looking to remortgage should consider a fixed rate mortgage and may have to do some shopping around to find the best deal or use the services of a mortgage broker such as Property Link Homes.

With further base rate rises expected and increasing house prices leading to stronger equity positions for homeowners, now is the time for borrower to take advantage of the current climate and avoid the increased costs of reverting to the standard variable rate provided by your lender. The Bank of England is also due to announce a possible further base rate increase on 3^rd February 2022, so if you want to remortgage, sooner is better.

It is always important to remember that before accepting any new deal or remortgage offer, you should consider your own circumstances and any incentives. The cheapest deal is not always the cheapest long term and with lenders now charging upfront fees as high as £1,999 on their lower rates, and a premium on their “no fee” deals, it can be hard to correctly assess the full cost of a mortgage over a fixed rate term. This is where the advice from a mortgage broker can be invaluable. Not only can they help you analyse current offers and advise on the cheapest and most cost-effective deals for you, but with access to exclusive offers they can help you find a loan that may not be available on the high street.*

To help clients find the best remortgage deal for them, Property Link Homes are providing a free mortgage review to see how much money can be saved a month by remortgaging. In some cases, this has been hundreds of pounds a month, so if you are on a fixed rate deal that is ending, or are looking to remortgage, then please get in touch with them today for your free review.

*As a mortgage is secured against your home, it could be repossessed if you do not keep up the mortgage repayments.

The end of last year saw the Bank of England announce a 0.15 increase on the base rate, pushing it up to 0.25%. This was in response to rising inflation as prices soared. After reviewing the data, and despite rising Omicron cases expected to hit the economy, in December the Monetary Policy Committee (MPC) voted to implement the first rise for over three years. 

With global energy prices causing huge increases and the expected energy price hike that is expected in April, everyone is watching with bated breath for the next Bank of England announcement. Due on the 3rd of February, the base rate is expected to be increased even further to help offset some of the expected 40% rise in the energy price cap.

As the base rate is used by the central bank to charge other banks and lenders when they borrow money, this has a direct effect on what borrowers can expect to pay.

So, what does this mean for mortgage rates?

In real terms, this base rate increase can be expected to hit current mortgage holders. For fixed rate mortgage holders whose deals are not about to end, the December base rate increase and any further rise in February will not have any significant impact until those terms come to an end. However, if you are a borrower on a tracker or standard variable rate (SVR) mortgage that follows the base interest rate, then these increases are going to have harder financial ramifications, especially combined with rising food and fuel costs.

Therefore, it is important, especially for those on the tracker and standard variable rates (SVR), whose lenders can increase rates by more than the 0.15%, to see if you can cut some of the expected rate rises by looking into better, fixed rate mortgage deals. Although lenders have only increased rates slightly to account for the Bank of England announcement in December, as the mortgage market factors in any possible further increases, borrowers can expect mortgage rates to rise and so it would be advisable to act now to secure the best savings.

Even if your current mortgage deal is not due to end in the next few months, we would advise speaking to a mortgage broker to gauge your options to move onto a fixed rate mortgage. Mortgage brokers can access around 98% of lenders and get exclusive rates and deals that would not be available to other brokers or by going directly to the lenders. This means they can help find you a cost-effective deal that will work to accommodate the interest rate hike.

Mortgage brokers such as Property Link Homes offer online services such as a mortgage calculator to work out how much you may be able to borrow, or repayment calculators to work out your affordable monthly repayments. *

However, we would always advise speaking to one of our experienced and friendly staff to get the best advice and to help better understand your mortgage options. If you are interested in how we can help you, and you are looking to re-mortgage, buy-to-let, looking for commercial property or are coming to the end of a fixed term deal, then please get in touch with one of our expert team today.

*As a mortgage is secured against your home, it could be repossessed if you do not keep up the mortgage repayments.

During 2020, the global pandemic saw low deposit mortgages become almost non-existent on the market due to the higher risk to lenders. Anyone wanting to purchase a home were forced to save further or rely on help from friends and family. This had a particular impact on first time buyers, who as a group, had relied heavily on low deposit mortgages.

In April of last year, the government launched the mortgage guarantee scheme to help buyers with small deposits to get onto and move up the property ladder. This initiative, launched in April 2021, was designed to encourage lenders to offer 95% loan to value (LTV) mortgages for properties worth up to £600,000 by offering a guarantee to participating lenders to cover some of the mortgage over 80%. This guarantee was to give lenders the confidence to reintroduce low deposit mortgages back onto the housing market.

The government guarantee will be valid for up to seven years after securing the mortgage and lenders will offer mortgages with fixed interest rates for at least five years to provide more security to buyers. With the Bank of England expected to raise the base rate further in February, however, now would be the time to take advantage of this scheme and the lower interest rate. However, the scheme will be open for new mortgage applications until December 2022.

So, who is eligible for the mortgage guarantee scheme?

The mortgage guarantee scheme is similar to the Help to Buy equity loan scheme but there are different eligibility requirements, so to find out if you would qualify for a 95% LTV mortgage then we have listed the eligibility criteria below:

• Property value must be less than £600,000
• It covers all properties, not just new build homes
• Mortgages will be offered subject to the lender’s usual affordability checks
• You can only take out a repayment mortgage using the scheme as there will be no interest-only options
• It can only be used by individuals and not businesses
• Cannot be used for buy-to-let properties
• You do not have to be a first-time buyer

I don’t qualify, what are my options for a low deposit mortgage?

Although this the mortgage guarantee scheme is a government initiative, lenders are not required to offer it, however, most big banks and building societies resumed low deposit mortgages in 2021 and are expected to continue these offers through 2022, despite the housing market due to slow down slightly thanks to inflation and increased interest rates. However, there is still a lot of caution from lenders, and this has been reflected in higher mortgage rates, so larger deposits are still recommended if you can.

If you are looking for a low deposit mortgage, especially if you are a first-time buyer, then you should always consult a mortgage broker such as Property Link Homes. They can access around 98% of lenders and get exclusive rates and deals that would not be available by going directly to the lenders. This means they can help find you a low deposit mortgage deal that will work to accommodate your circumstances.*

We advise speaking to one of their experienced and friendly staff to get the best advice and to help better understand your mortgage options. If you are interested in how they can help you with low deposit mortgages, then please contact their expert team today.

*As a mortgage is secured against your home, it could be repossessed if you do not keep up the mortgage repayments.

If you have recently found yourself in a position to buy a house, you may be wondering whether now is the right time. With the housing market experiencing record sales and prices, committing to buying a house in 2022 can seem like a big decision and you would be wise to consider all the varying factors around the current economic climate such as the effect of pandemic, Brexit and the future energy price rise.

Although those factors may seem like a negative, there are several reasons you should think about purchasing a new home this year.

House Prices

Although the rising cost of houses may be a negative for some potential buyers, especially first-time buyers, if you are already a homeowner, the house price increase can actually work in your favour. If you are looking to downsize of move into a more affordable home, then selling and moving now would be beneficial.

For those looking to get into the market for the first time, or looking to buy a bigger property, then house prices are predicted to slow down during 2022, so it could be worth waiting for a few months for the housing market to settle slightly to try and get a better deal that you would be able to access now.

Mortgage Guarantee Scheme

In April of last year, the government launched the mortgage guarantee scheme to help buyers with small deposits to get onto and move up the property ladder. This initiative, launched in April 2021, was designed to encourage lenders to offer 95% loan to value (LTV) mortgages for properties worth up to £600,000 by offering a guarantee to participating lenders to cover some of the mortgage over 80%.

This means that if you only have a 5% deposit, you can still get access to a mortgage and move onto the property ladder. Several big high street lenders including NatWest, Barclays, HSBC, Lloyds, Santander, and Virgin Money have signed up to the scheme, which is running until the end of 2022, and with other banks and building societies having their own small deposit initiatives in place, now is a really good time to try and buy a home if you haven’t got the option to save a huge deposit amount.

Low Interest Rates

2021 saw a record low in mortgage interest rates, with sub 1% mortgages being offered for those with a decent sized deposit. However, in November of last year, the Bank of England increased its base rate to 0.25%. This and a predicted future increase in February has meant that lenders have begun to increase their mortgage rates. Though thanks to the already low starting point, the interest rates are still relatively low. Which is why now would be a great time to purchase a property before the cost of borrowing becomes even higher due to further rate increases.

There is no definitive answer to whether now is a suitable time to buy, it is dependent on personal circumstances, which is why speaking to a mortgage broker is a good idea when considering your options. Property Link Homes have over 30 years of experience in finding their clients their ideal home for the best possible price and can help you find deals and offers you won’t find elsewhere. *

If you are interested in how a mortgage broker can help you, and you are looking to re-mortgage, buy-to-let, looking for commercial property or are coming to the end of a fixed term deal, then please get in touch with one of our expert team today.

*As a mortgage is secured against your home, it could be repossessed if you do not keep up the mortgage repayments.

As the name may imply, the property loan known as the "bridging loan" is only intended to be a temporary fix. It helps you "bridge" toward a longer-term solution, whether that's a loan, mortgage, or releasing some money that's been restricted.

Let's take the scenario where you have decided to purchase a new home, but the sale of your current home still needs to be completed. When your old property is sold, you could switch to a regular mortgage and use a bridging loan to purchase a new home.

Property investors are also big fans of bridging loans. In the vein of Homes Under the Hammer, you may use a bridging loan for property development by using it to purchase a house at auction, renovate it, and then resell it for a profit.

How Does a Bridging Loan Work?

We're now getting down to business. What would happen if you submitted an application for a bridging loan? And what should you think about before applying for one?

First and foremost, keep in mind that there are two types of bridging loans: regulated and unregulated.

The distinction is whether your bridging loan has an end date that must be met (a regulated bridging loan) or whether it has no predetermined end date (an unregulated bridging loan).

How Does a Regulated Bridging Loan Work?

A regulated bridging loan can only be for 12 months. Regulated means you of a family member has either resided in the property or are going to reside in the property.

Let's imagine you've agreed to sell your current home, but the transaction has yet to fully go through, and you need to move on with buying your new house.

In essence, you are aware that the money is on its way to your bank account; it just hasn't done so yet. In these situations, a regulated bridging loan might be preferable since you'll be able to plan when you'll be able to repay the loan in full within the 12-month term.

How Does an Unregulated Bridging Loan Work?

Bridging loans that are not regulated are a little different. Let's say you must proceed with buying your new home, but the sale of your current residence still needs to be completed. 

Maybe you have yet to find a buyer, or your sale won't close on a specific date. In essence, you are still determining when the money will start to come in.

Unregulated bridging loans have a maximum length of 24 months. This could be for commercial or buy to let.

It is also important to note, if there is any residential part, it must be less than 40% of the floor area or the property.

Bridging Loan Interest Rates

At first appearance, the interest rates on bridging loans, which start at about 0.4% as of this writing, could appear to be quite low.

However, it's crucial to keep in mind that interest is calculated on a monthly basis rather than an annual one, as with typical mortgages. As a result, borrowing money with a bridging loan might be rather expensive, especially if you wait to pay it off immediately.

Consider borrowing £200,000 for a period of nine months at the cost of 1% per month. That may not seem like a high-interest rate, but over the course of the bridging loan, you will end up paying over £18,000 in interest, or about £2,000 per month.

Conclusion

Overall, bridging Loans can be a great option for short-term financing needs, but it's important to understand the different types and their associated risks before making a decision. It's also essential to work with a reputable broker who can help you find the best bridging loan for your specific situation.

If you are looking for a great bridging loan broker in the UK, look no further than our experts here at Property Link Homes. We provide mortgage advice, home insurance or buildings and contents insurance, as well as protection, including life insurance, income protection and critical illness cover. We are also a provider of bridging loans. Call us today, and let us discuss all your viable mortgage options.