News Review
Market pins hopes on new build By Sarah Davidson
Three lenders launched NewBuy product ranges last month including NatWest, Nationwide and Barclays but Santander, HSBC and Lloyds Banking Group have yet to reveal the details of their support. It comes as the government
launched its NewBuy scheme designed to help borrowers buying new property get a 95% loan for purchases up to £500,000 with taxpayers and builders as co-guarantors. NatWest was criticised for
launching the product di- rect-only while Nationwide has limited initial distribu-
tion to brokers. In a letter published in the
Daily Telegraph last month Stewart Baseley,
executive
chairman at the Home Build- ers Federation, said it was “incredibly frustrating and annoying” that three of the major lenders in the market had been slow to join in. Lloyds has said
it plans
to launch fully in April while Santander promised to launch by mid-year and HSBC said it was in the pro- cess of readying its proposi- tion. Countrywide said the misfired launch of NewBuy in the UK housing market was “inevitable and indeed
• Nationwide will offer a 3-year fixed rate at 5.69% with a £900 product fee and £99 booking fee for house purchase and existing customers moving home. A fee- free version also exists at a rate of 5.99% with a £99 booking fee. It will also offer a 5-year fixed rate at 5.99% with a £900 product fee. A fee-free version also exists at a rate of 6.19% with a £99 booking fee.
• NatWest has launched two 95% loan to value NewBuy products for 2-year and 5-year terms fixed at 4.29% and 4.99% respectively. Both products come with a £499 fee.
• Barclays has launched a 2-year fixed rate mortgage at 4.99% or a 4-year fixed rate deal at 5.89% under the scheme. Both come with a £499 application fee and revert to a lifetime tracker at Bank Base Rate +3.99%.
exactly as predicted”. Nigel Stockton, financial services director of Coun- trywide, said: “I have been saying since October 2011 that NewBuy is a great step in the right direction for both builders and lenders. But if we all wanted New- Buy to work properly with a successful launch then it should have waited until all the major lenders – includ- ing Lloyds Banking Group (especially the Halifax) and Santander - had time to build their automated systems.”
Market predictions Once the scheme kicks off properly experts claim new build lending is likely to grow £1.5bn by the end of the year taking gross lend- ing to £8.5bn. Stockton said: “Developers are experienc- ing a resurgence in profits with Bovis, Redrow, Barratt Developments and Galliford Try reporting profits of late. This, coupled with a rise in new build lending and buy- to-let which could rise by as much as £2.5bn to £16.5bn this year, is encouraging news for developers.”
New build moves Mortgage Advice Bureau purchased brokers Mortgage Talk in exchange for shares in late March. The combined group will now have over 500 advisers which MAB says will top £4.5bn in mortgage applications. MAB’s chief executive Peter Brodnicki said the Mortgage Talk brand and its reputation in the new build arena was a key driver for the deal and the network planned significant expansion for the specialist sector. Mortgage Talk’s chairman Peter Birch will join the MAB board as the second largest shareholder while Brodnicki will continue to run the company and will retain majority stake in the MAB Group.
Brodnicki said: “This is great news for both companies as it will allow us to create a truly formidable force in the mortgage industry.”
And Birch said: “It will give us real scope to launch a new and truly innovative offering to builders and specialist new build mortgage brokers throughout the UK.”
4 MORTGAGE INTRODUCER APRIL 2012
www.mortgageintroducer.com
R E S I D E N T I A L & B U Y T O L E T R E S I D E N T I A L & B U Y T O L E T GREAT BRITISH MORTGAGES.
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