Mortgage Advice Bureau comments on the latest house price indices

Brian Murphy, Head of Lending at Mortgage Advice Bureau (MAB), comments on the Land Registry and Nationwide House Price Index:

“House prices continued to edge up in July, with figures for August also showing further gains, despite the summer traditionally being a quiet period for the housing market. Annual price increases also indicate a strong recovery, with consumers in the capital not the only beneficiaries: several regions outside of the South of England have experienced significant house price boosts. This is good news for existing homeowners looking to ascend the property ladder or those hoping to get a better deal on their current mortgage, as it increases the equity at their disposal.”

“However, there have been signs that the property market is beginning to cool, with the rate of price increases slowing in recent months. News of tighter mortgage lending restrictions and a possible interest rate rise is likely to have infiltrated consumers’ thinking, introducing a degree of caution among potential buyers and dampening demand.”

“Affordability is still a key concern among first-time buyers, so a slight slowdown in the rate of house price increases will be a welcome sign. With lenders operating under increasingly tight restrictions, support measures like Help to Buy are becoming even more important to ensure that homeownership dreams are not crushed under the weight of rising property prices. It’s vital that prudent high loan to value (LTV) mortgages remain an option for people looking to buy, providing their finances stand up to inspection.”