Mortgage brokers and commentators have spoken of an air of caution among clients as the Budget approaches on November 26.
John Phillips, national operations director for Just Mortgages, said: “There’s no doubt we are seeing an element of wait and see right now.
“Hopefully, this gives way to some pent-up demand once the Budget is cleared and everyone knows the lay of the land.”
Similarly, Rachel Springall, spokesperson for Moneyfacts, said: “There will be borrowers sitting on the fence until the Budget, and others stuck due to a short supply of affordable housing.”
Latest statistics
Their comments came as figures showed the mortgage market continued to grow in September despite Budget uncertainty, according to the Bank of England’s Money and Credit Statistics.
There was a net increase in borrowing and approvals for September after a downturn in August.
Having risen by £1.2bn to £5.5bn, the net borrowing figures were the best since £13.2bn in March. Net mortgage approvals also increased by 1,000 to 65,900.
Brokers generally expressed confidence in the figures, which they described as “reassuring”.
Colby Short, co-founder of GetAgent, said: “The latest figures show that mortgage approvals have bounced back following [the Summer’s] dip, providing yet more evidence that the market remains on a stable and upward trajectory.”
Similarly, Jonathan Samuels, chief executive of Octane Capital, said the figures provided “further reassurance that confidence remains embedded within the mortgage market”.
The longer-term picture was also positive.
Emily Williams, director of research at Savills, said: “Q3 saw the highest level of mortgage approvals for house purchases so far this year and was also 2 per cent higher than the same period last year.”
End of the year in sight
However, brokers and commentators were keen to point out that it was usual for the market to have seasonal changes with an autumnal surge, Budget or no Budget.
Remortgage approvals fell for the fourth consecutive month, dropping by 600 to 37,200.
According to figures from Phoebus, this indicated that borrowers were holding off decision making.
Springall added: “As we get closer to the end of the year, there will still be some borrowers looking to remortgage, and those still locked into a fixed deal could still agree a new one in readiness for when a fixed term expires.”
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