Callum Taylor’s Post

Transcript

As we approach the end of the year and the festive period, I thought it a great opportunity to bring you our year end review. Everything we've seen in the market this year, giving you an overall picture of interest rates, inflation, mortgage rates, various different products and what lenders are up to this year and what we think we'll see next year. Starting to take a look at key trends we have seen so far this year. Interest rates were very high at the start of the year. Swap rates. Did stabilize throughout the year gradually falling. But I think what we've seen later on this year is those swap rates begin to bounce back up a little bit from what we saw as an 18 month low in around September. They have bounced back up to similar to where they were at the start of the year. But interestingly enough mortgage rates have continued to fall. I think in the last few weeks they have maybe slightly tailed off and picked up slightly. But overall picture is that we expect these rates to continue to fall into. Next year with a bit more stability in the market, the markets had a lot to deal with in new government election in the US, very recent budget, etcetera. Taking a look at the review for the year in terms of house prices, we have seen the figures up till the end of October at a 2.1% increase, which roughly speaking is in line with the inflation rate, so fairly stagnant. But I think what is very apparent and has been very apparent all year is that the number of properties coming to the market has increased and the number of sales going through has most definitely decreased. Which is forever showing us that is definitely a buyers market and I think what we will see going into 2025 is more professional landlords really getting a strong foothold in the market. I think given the budget changes, it's going to be difficult for amateur and first time property investors to get into the space or looking at rents. Rents have continued to rise throughout the year and I would expect the same to happen in the new year. I don't think that's going to slow down anytime soon with the increases. In stamp duty, I think will continue to see these increase. Taking a look at the two very key factors people spend a lot of time looking at being inflation and the Bank of England base rate. Starting with inflation made big progress this year. We've had a slight spike recently, but very small. I think, you know, the current level of 2.3% is, is very manageable and I think that hopefully stabilizes around that level subject to, you know, the the. The two apps, as they say, food and fuel, but I think we're at a good level there and I think it's a very manageable level. Taking a look at the base rate, 5 1/4% at the start of the year, 4.75% now. There is another meeting before Christmas after the filming of this video, but I don't think we should expect to see it any further reductions there. And I think we should continue to see reductions in that base rate. Economic data says probably around 1% next year. So that would be great. I think if we get 3 3/4 by the end of next year, people in the market, borrowers borrowing money on a short term basis, bridging loans, development loans could really start to see a benefit of cheaper pricing coming into the new year. On that question I'm often asked, especially with the recent base rate change. Early in November by clients is why the base rate coming down. My two and five year fixed mortgage offers aren't any cheaper. That is obviously because two and five year fixed mortgages are based on long term swap rate money which has been a little inconsistent throughout the year. So we're relatively at the same level there as we were at the start of the year as we are now. So I think as well there as that continues to stabilize post new government here, new government, the US. Budget, et cetera, those will both hopefully continue to fall in the right direction. That's where the data is currently telling us. There's some other important things we've seen this year from our clients and from arranging loans for all of our clients, speaking with lenders, etc. Some very key things to highlight. I think bank appetite is a big one. I think there has been a big increase in the last few months from banks, specialist lenders all the way through the market of wanting to now be more aggressive and write loans. That is maybe impacts. Pricing slightly making it more competitive and maybe now is a good time to act. Whether you're looking for a mortgage or a bridging loan, isolat loan, commercial mortgage, etcetera, it could be a very good time to move despite rates potentially falling next year. There's always the argument of when rates do fall, if appetite decreases, then that doesn't necessarily pass through into the customers. Another key thing we've seen from a development point of view is a number of sales moving slowly, ever more prevalent development exit products available in the market. You can get these over base rate, you can get these at fixed rates, just allowing developers and sellers more time to get the right price for their asset. I think certainly towards the end of this year we have lost at least probably two months. Very common speaking with our clients, people waiting for the budget, what news that had and then people waiting for the new year. So I think looking forward into the spring and into January, I think we can see a lot more positive natured sales and a lot more people in the market looking for a property having held off for the last couple of months. Finally, just looking at mortgage rates, as touched on earlier, these slightly came up recently, but I think once we see the period in January, these probably will begin to fall again. But I think, you know, overall message as always is more important than ever to speak with your broker, see what's going in the market. They'll have their ear to the ground. They're seeing rate updates all the time from lenders and can often time things correctly. For you. So please get in touch and we'd love to help. So the last thing that really leaves me to say is thank you very much for your support this year, whether you be a client and introducer, a partner of ours or one of the many lenders we work with. I think it's been a tough year in some areas, but also it's been an exciting year to see what's going to happen next year here at Port Way. We've been growing our team throughout the year and we have a couple more staff to start in the new year and I think we are really ready and our team has even greater relationships than they had at the start of the year. Lenders and I think we can really help you coming into the new year, whether it be moving house, whether it be your first by select purchase, future commercial property development, short term loans, etcetera. Please get in touch and have a great Christmas and a happy New Year.