![Higher Mortgage Rates "sucking life out of the housing market"](https://www.introducertoday.co.uk/upload/images/240617%20%2001.jpg)
A number of major mortgage lenders have announced rate increases just as the election campaign enters its second half.
Barclays has increased a number of deals by 0.15%, TSB has increased rates across its residential and Buy To Let ranges by up to 0.35% (including Existing Client products), while smaller increases by Leeds Building Society, Clydesdale Bank were also announced.
Newspage asked brokers for their views on this – and got them:
Justin Moy, managing director at EHF Mortgages, comments: “It feels like one lender has blinked and the rest have followed. Money markets haven’t increased excessively in the last week or so, in fact longer swap rates have fallen, so these increases may reflect activity from the end of last week. At a typically busy time for home buyers, higher mortgage rates are the last thing borrowers and the property market need. The year started on a high but now the mortgage and property market, much like the weather, is unseasonally bad.”
Katy Eatenton, mortgage and protection specialist at Lifetime Wealth Management, says: “Rising mortgage rates are sucking the energy out of the property market. This is certainly not the direction of travel we had anticipated for this stage in the year. It’s looking ever more likely that the base rate will hold next week and that the outlook for borrowers will be roughly as bright as the UK summer.”
For Stephen Perkins, managing director at Yellow Brick Mortgages, there’s an absence of confidence. He notes: “Wage growth data proving sticky means there is not huge confidence in a base rate reduction in the early summer. As a result, some lenders are playing it safe by slightly increasing rates. There is also an element of lenders managing levels of new business through these adjustments as some are struggling with demand for their products and managing to service the level of applications. Nothing that has been said in any of the election debates so far has given us much confidence in the direction of travel for the economy. The mortgage and property market appear to be drifting aimlessy right now.”
According to Ben Perks, managing director at Orchard Financial Advisers: “Rates are climbing as the election campaign nears completion. There is a glimmer of hope, though, as swap rates appear to be reducing. This could mean some better deals in the weeks to come once this latest tranche of funds is gone and new money brought in. This should mean that cheaper deals are on the way, which will be a huge relief for families that are struggling to pay for Sky TV, which it can be traumatic to go without, can’t it Rishi?”
Dariusz Karpowicz, director at Albion Financial Advice, bemoans the quality of debate in the election campaign. “It seems like the topic [of housing] is taking a backseat to discussions about potholes and whether Sky TV is affordable. Uncertainty always has a negative effect on markets. This mid-election campaign rate hike indicates that lenders are bracing for potential economic shifts and instability. Borrowers are caught in the crossfire of political and economic uncertainty, making it crucial to stay informed and agile in managing their mortgage decisions. Let’s hope for some clarity and positive movement in the coming weeks to steady the market.”