Weekly Summary: 11th June 2021

DATA: Halifax reported a new record high for UK house prices in May

The annual growth rate increased to 9.5% (previously 8.2%) with a 1.3% monthly rise.

DATA: ONS reported a 2.3% monthly increase in GDP in April

GDP was 6.1% higher than the same month last year but still 4% lower than January 2020.

DATA: Bank of England reported further falls in mortgage rates in May

Quoted rates for 60% LTV, 2 year fixed rates fell to 1.2%, the lowest ever. Rates for higher LTV products are falling but remain higher than before the pandemic.

DATA: ONS reported Construction Output fell 2% in April

Despite the fall, construction output was 0.3% higher than February 2020.

DATA: Bank of England & FCA released Mortgage Lenders & Administrators Return statistics for Q1 2021

The release provides a wealth of information on the mortgage market. See our Digging Deeper and Chart of the Week for more detail.

DATA: MHCLG released Energy Performance of Buildings Open Data

The release provides Energy Performance Certificate data for individual homes in England & Wales up to 31st March 2021.

REPORT: RICS reported “Solid demand and a shortfall of new instructions continues to drive house prices higher” in May

They reported that “New instructions continue to dwindle over the month” while “New buyer enquiries and agreed sales still displaying solid momentum”. They also reported that the rental market in London appears to be recovering “with both the three and twelve month rental growth expectations series moving into positive territory”.

REPORT: HCLG Committee report on The Future of The Planning System

The report looks at the Government’s proposed planning reforms and suggests that they reconsider the case for growth, renewal, and protect zones. It also suggests that people “must still be able to comment and influence upon all individual planning proposals” and they approve of the decision to abandon the proposed formulate for determining housing need. However, they would like clarity on how the “urban uplift” in housing delivery can be met. They also suggest “Government should set a limit of 18 months following discharge of planning conditions for work to commence on site” with permission revoked if work has not progressed and call on government to “lay out the evidential basis for its 300,000 housing units a year target and how it will achieve it, both by tenure and by location”.

REPORT: ONS released report on Rough Sleeping in the UK 2002 to 2021

The report compared statistics from across the UK to investigate trends in rough sleeping.

NEWS: Rightmove reported the “Biggest sales pipeline over past ten years”

They reported “More than 700,000 homes are marked Sold Subject to Contract and going through the sales process” while a survey suggested “only 4% [of buyers] would abandon their plans to buy a property if they missed either the June or September deadline”.

Chart of the Week

There is a wealth of information in the Bank of England and FCA’s MLAR data release but it also allows us to create relatively timely estimates for the number of mortgaged movers and first time buyers. Charting these estimates as a share of total transactions highlights some interesting trends in recent years. As the chart below shows, the proportion of transactions that were first time buyers had been consistently around 22% until the introduction of higher SDLT rates for investors buyers in early 2016 (grey bar). Since then first time buyers had gradually increased their share of transactions, reaching 31% in Q2 2020. However, the combination of the credit crunch, SDLT holidays for all buyers, and renewed demand from home movers have all contributed to reduce first time buyers’ share of transactions down to 25% in Q1 2021. We will have to see if this is just a temporary effect that disappears when the current SDLT holiday ends.

Instant Info – Mortgage Advances by Buyer Type

In the absence of publicly available data from UK Finance and delays in publication of the FCA’s Mortgage Product Sales Data, we have constructed our own estimates of quarterly mortgage activity by first-time buyers and home movers.

It is simply the total value of mortgage advances to each group from the Bank of England’s MLAR data (table 1.33)* then divided by the average mortgage advance to each group from the Regulated Mortgage Survey published by ONS (table 15).

We have tested it against other data sources and it appears to accurately reflect mortgage activity but should only be relied upon at your own risk.

*make sure you use the aggregated data containing both regulated and non-regulated data near the bottom of the sheet.

First Time BuyersMortgaged Movers
Q1 200783,056151,564
Q2 200795,591181,998
Q3 200797,817191,380
Q4 200780,632156,206
Q1 200853,21895,629
Q2 200855,72899,780
Q3 200845,44278,525
Q4 200839,04063,249
Q1 200929,69946,867
Q2 200943,54871,259
Q3 200955,52593,227
Q4 200962,823102,828
Q1 201040,63669,603
Q2 201048,64984,380
Q3 201053,85996,346
Q4 201048,31481,542
Q1 201137,22361,673
Q2 201146,73675,631
Q3 201152,40591,507
Q4 201152,07784,795
Q1 201249,67868,880
Q2 201246,01277,391
Q3 201252,66985,031
Q4 201255,95582,199
Q1 201345,83164,675
Q2 201355,88981,183
Q3 201367,42197,385
Q4 201372,20498,135
Q1 201463,27079,739
Q2 201473,72692,107
Q3 201476,519101,608
Q4 201472,83491,723
Q1 201556,74968,854
Q2 201569,64881,918
Q3 201580,27599,854
Q4 201583,75597,374
Q1 201667,22289,573
Q2 201679,82578,986
Q3 201686,13192,053
Q4 201685,09689,112
Q1 201774,86879,694
Q2 201785,91491,664
Q3 201791,096103,663
Q4 201791,13699,845
Q1 201875,60278,358
Q2 201886,88388,047
Q3 201891,404101,851
Q4 201893,52999,588
Q1 201974,32678,242
Q2 201984,59287,471
Q3 201994,360100,433
Q4 201992,44598,854
Q1 202075,72376,531
Q2 202046,58744,825
Q3 202078,25882,663
Q4 2020102,218121,353
Q1 202196,118137,969