Top Mortgage Strategy News: Key Updates for This Week
Stay on top of the latest critical mortgage updates for this week. The election casts uncertainty over lease and rent reform plans, while experts suggest the BoE should consider cutting rates by up to 0.75% in 2024. Get the information you need to make informed decisions.
Elections cast doubt on lease and rent reform projects
The fate of the Leasehold and Freehold Reform Bill and the Tenants (Reform) Bill is uncertain after Prime Minister Rishi Sunak announced a general election on July 4. With Parliament dissolved on May 30, both bills are unlikely to become law. Glenhawk general sales manager Jamie Pritchard expressed his frustration, saying it was disappointing for all parties involved, including landlords, property managers and tenants who are looking for improved safety and standards.
BoE expected to cut rates by up to 0.75% in 2024, says IMF
The International Monetary Fund is recommending that the UK cuts interest rates up to three times this year to support the economy’s gradual recovery from a mild recession. Advocating a reduction of “around 50 to 75 basis points” in 2024, the IMF highlights the need to maintain economic momentum following the country’s recent exit from a technical recession. A stagnation or reversal of the recovery could occur if the Bank of England keeps its rate constant amid falling inflation and expectations, which could lead to a prolonged underachievement of the inflation target , warns the IMF.
Chetwood Buys CHL Mortgages Ahead of ModaMortgages Launch
Chetwood Financial, a digital bank, has acquired rental lender CHL Mortgages for Intermediaries, intending to operate it alongside its upcoming BTL business, ModaMortgages. Established in 2016, the app-based bank plans to leverage this acquisition to leverage CHL Mortgages’ experienced mortgage team, expand its mortgage portfolio and expand its presence in the mortgage intermediary market. ModaMortgages and CHL Mortgages will operate as specialist BTL lenders, acting exclusively through intermediaries.
A rate cut “possible” this summer, says Broadbent (BoE)
The outgoing deputy governor of the Bank of England raises the possibility of a cut in interest rates in the United Kingdom this summer if inflation continues to fall. Ben Broadbent noted that the direct impact of the pandemic and the Russian conflict in Ukraine on inflation has diminished. However, he stressed the importance of assessing whether lingering effects on domestic prices and wages would persist longer than it took to initially materialize.
Inflation slows to 2.3%: ONS
In April, the consumer price index fell to 2.3% from 3.2%, according to data from the Office for National Statistics. Although this figure is closer to the Bank of England’s 2% inflation target, it remains at the upper end of forecasts. The Bank of England has reiterated its stance on interest rates, stressing that they will not be cut until there are clear signs that inflation is under control. Lower gas and electricity prices were the main factor, partially offset by higher fuel prices compared to the previous year.
HSBC opens international property loans to UK brokers
HSBC has extended its international buy-to-let mortgage services to UK brokers, marking the first time it has done so. Coverage covers 14 countries and regions, including Australia, Hong Kong, Singapore, Switzerland, UAE, USA, Guernsey, Isle of Man and Jersey. Additionally, HSBC has expanded the availability of its international BTL mortgages, allowing residents of five more countries – Egypt, Malaysia, the Philippines, Qatar and Taiwan – to invest in the UK property market through BTL and mortgages. residential with HSBC UK.
Winners announced at the 2024 Mortgage Strategy Awards
The mortgage industry gathered once again at the JW Marriott Grosvenor House Hotel in London to celebrate the Mortgage Strategy Awards 2024. TV and radio presenter Colin Murray was our host for the evening and did not disappoint! The judges had a particularly difficult task in choosing who should emerge victorious this year, with many highly commended companies highlighted; everyone who was shortlisted should be proud.
The election campaign could lead to a slowdown in lending
The property industry is hoping the general election will prioritize calls for more house building and stronger protections for landlords during the campaign. However, the first impact on the sector could be the slowdown in mortgage lending. Prime Minister Rishi Sunak announced yesterday that the country would go to the polls on July 4. Nicholas Mendes, technical director of mortgages at John Charcol, commented: “During the period leading up to an election, uncertainty about the future political landscape typically causes fluctuations in financial markets. »
FCA plans to make UK ‘the best place in the world to do business’
The head of the Financial Conduct Authority said it was “working hard to make the UK the best place in the world to do business”. Managing director Nikhil Rathi added: “We don’t just set the rules, we help shape the ecosystem and long-term risk appetite with which businesses operate. » The city’s regulator chief outlined the watchdog’s agenda for the rest of the year and beyond at the Association of Corporate Treasurers’ annual conference yesterday.
Halifax will reduce moving and FTB rates
Halifax informed brokers it would cut rates on products for movers and first-time buyers by up to 19 basis points on Friday. Discounts will apply to two- and five-year plans. John Charcol’s technical director of mortgages, Nicholas Mendes, sees this as good news amid current declining mortgage market data. He explains that inflation data suggests a prolonged hold in the market, indicating that mortgage rates will remain slightly higher for some time to come.
