This month’s edition of Spread the Word is jam-packed with mortgage news and protection updates. Plus, we’re busting some of the mortgage broker myths. Read on to find out more…
MORTGAGE NEWS & UPDATES
House price growth accelerates 12.6% in February: Nationwide
Annual average house price growth accelerated by 12.6% in February according to the latest Nationwide House Price Index (HPI) report, up from 11.2% the month before.
This is the seventh consecutive monthly increase in average house prices according to Nationwide HPI data, with the month-on-month growth rate accelerating.
In February 2022, the monthly change – a seasonally adjusted figure – was 1.7%. In contrast, the monthly change was 0.8% in January 2022.
The average price of a house is now above £260,000, at £260,230, for the first time with a combination of robust demand and limited stock keeping an upward pressure on prices.
In January 2022 the average house price had been £255,556.
Such pressure means the price of a typical home is 20% higher than in February 2020, with the average price rising £29,000 over the past 12 months alone.
SOURCE - MORTGAGE STRATEGY
Mortgage Broker Myth Busting
As mortgage brokers, every day we help homeowners and property investors to save money, time and stress to smooth the process of securing their next mortgage. But don’t just take our word for it, here are some of the most popular mortgage broker myths busted…
Why use a mortgage broker?
A broker works directly with you to give you access to hundreds of mortgage solutions to help you decide which is right for you. As professionals, they have a duty of care in the advice and products provided. So, rest assured you are in safe hands. SOURCE - MARSH COMMERCIAL
Are mortgage brokers better than banks?
They essentially negotiate rates for you and because they acquire high quantities of mortgage products you get the maximum benefits available. Banks, on the other hand, can only offer their own mortgage products. SOURCE - RATE HUB
Can a mortgage broker get you more money?
They will probably save you money. Mortgage brokers have access to competitive options and exclusive deals that you may not be able to get if you went directly to the lender. SOURCE - CLEAR SCORE
Landlords hone in on UK ‘secondary’ towns and cities
Buy-to-let (BTL) landlords are increasingly targeting smaller towns to buy properties in, according to recent analysis from Paragon Bank.
According to the bank’s data, aside from London and Manchester, completions during 2021 were highest outside the UK’s major city centres, in “secondary towns and cities.”
Completions in Milton Keynes spike 667% in 2021, compared to the previous year, while completions in Bristol increased 300%.
Completions in Manchester and Luton increased 300% and 258%, respectively.
They also accelerated substantially across Plymouth, Stoke, Northampton, Cardiff and Nottingham, where they spiked 183%, 157%, 133%, 70% and 64%, respectively.
SOURCE - MORTGAGE STRATEGY
Inflation expected to close on 9%: CEBR
Quarterly inflation could rise to 8.7% in the second quarter of this year and remain above 7% until the first quarter of 2023, says the Centre for Economics and Business Research (CEBR).
It adds that the Bank of England (BoE) interest rate will now average 0.7% for the whole of 2022, 1% for 2023, and 1.25% for 2023.
CEBR says that despite high inflation, the BoE, “traditionally does not try to respond to one-off shocks... and in fact we expect that in the new environment there would be less tightening than we had previously calculated.”
SOURCE - MORTGAGE STRATEGY
Rental costs to rise £4.6bn: Hamptons
Tenants face an extra cost of £4.6bn in 2022 due to the rising cost of rent attributing to the ongoing cost of living crisis, according to the Hamptons Monthly Lettings Index.
Tenants will end up paying more than ever on rent and bills, with an average of 54% of household income set to be spent on these in 2022.
This is an increase from the 52% figure in 2021.
SOURCE - MORTGAGE STRATEGY
Protection news & updates
Financial stress keeping majority of ill employees at work
The majority of ill employees are still going to work due to financial stress, according to research from Nationwide Building Society.
A poll of over 2000 people found 59% had gone to work when ill or injured.
Financial concerns were the overriding reason for employees working regardless of their health.
Two thirds (64%) revealed they worried if they would cope financially if they had to take four or more weeks off work due to poor health.
These concerns are even frustrating healthcare and how it is received.
One in three (32%) admitted they had not followed their doctor’s advice because they couldn’t afford to take time off.
Meanwhile, 43% said they would put off going to the doctors due to financial concerns, even if they were concerned they potentially had a serious illness.
These respondents’ financial concerns reflects a widespread state of vulnerability with many not having income protection or critical illness cover in place.
Three in 10 (30%) admitted they had nothing in place to support them financially if they could not work.
SOURCE - MORTGAGE STRATEGY
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