News Review: Housing
Nationwide For Intermediaries Back to the good times by
Stephen Smith, director housing & external affairs for Legal & General Network
i did an internal presentation to one of our boards recently, and preparing for it brought home to me just how most of us in the mortgage market live in a bit of a bubble about where we currently are and
how bad it is. the powers that be need to trust us with this recovery. trust that the people still in the mortgage business and those who have departed will never go there again. We have to accept the messages behind the mortgage market review that things got out of hand and new rules need to be put in place to make sure they don’t happen again. So what is reasonable to set as an objective of a well functioning mortgage market? How much volume, how many sellers and how many transactions? to return to the long run average for transactions of around 1.2m per annum (england and Wales) i think we need gross mortgage lending to rise to around £210bn to £220bn a year. this would be with no uplift in remortgaging activity, which i think the regulator believes is “not socially useful” anyway. this level of lending
“By the time this market returns there could be well over a million first-time buy- ers who have been left out... Talk about pent up demand”
seems a long way away. the Hometrack forecast at the beginning of this year shows gross lending only back to £170bn by 2015. getting gross lending to over £200bn may be six or seven years away. every year that we fall short of this figure, there is demand not being satisfied and this has real impact on people’s lives.
one report i have seen relates this situation specifically
to first-time buyers. taking into account the suppressed number of first-time buyers over the last three years, by the time this market returns there could be well over a million first-time buyers who have been left out of the market. talk about pent up demand. the third piece of the jigsaw – the real elephant in the
room – is of course the supply of new houses to the uK stock. For unless there is a radical and swift return of housebuilding, up to a level of completions not seen in this country since the 1970s, then when this pent up demand returns to the market and is able to be satisfied, the lack of available property will simply drive up house prices again.
Ticking
the boxes for fi rst time buyers
As part of our commitment to getting the nation moving, we’re packing some great benefi ts for fi rst time buyers.
£500 product fee discount on selected products
15% off your client’s moving costs with Pickfords
10% off Big Yellow Self Storage on top of any of their other offers Shared Ownership schemes accepted Equity Share schemes accepted
For more information contact your local BDM or visit
www.nationwide-intermediary.co.uk
Details correct at time of going to press.
For Intermediary use only Nationwide Building Society, Nationwide House, Pipers Way, Swindon, Wiltshire, SN38 1NW Applications are required. Standard terms and conditions available on request.
F425 V1 (05-2011)
mortgage introducer JUNE 2011 17 NW_HPV_87x245_First time
buyers.indd 1 02/06/2011 11:22
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