Mortgage Strategy’s Top 10 Stories of the Week:
Accord and NatWest are slashing rates tomorrow, and the industry breathes a sigh of relief as the base rate drops. Don’t miss our in-depth coverage of the most important developments shaping the mortgage market this week.
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Accord and NatWest to cut rates tomorrow
Accord and NatWest have both announced rate cuts effective tomorrow. Starting at 8 am on Thursday, Accord will lower its product transfer and additional loan rates, with fixed rates decreasing by 10 to 20 basis points, though specific new rates have not yet been detailed. NatWest will also trim rates on several new business products by up to 15 basis points, effective July 31.
Rayner outlines brownfield, grey belt, green belt housing drive
Angela Rayner has unveiled a major overhaul of the English planning system to support the new government’s target of building 1.5 million homes over five years. The Ministry of Housing, Communities, and Local Government will update the National Planning Policy Framework and reintroduce mandatory housebuilding targets in England. The government aims to construct 370,000 new homes annually, exceeding the previous Conservative target of 300,000 homes per year by the mid-2020s, which was not met.
Industry welcomes base rate cut with ‘huge sigh of relief’
Mortgage brokers, lenders, and other property market professionals have welcomed today’s reduction in the Bank of England base rate. The rate has decreased to 5% from a 16-year high of 5.25%. Mark Hollands, Head of Sales and Distribution at Bluestone, commented, “Would-be and current borrowers across the country will no doubt be relieved by today’s much-anticipated decision, as rates fall from their historic high. This move should boost consumer confidence and help stimulate activity in the mortgage market.”
BoE cuts interest rate to 5%
The Bank of England’s Monetary Policy Committee (MPC) has cut interest rates by 0.25% to 5%. The decision, made by a majority of 5 to 4, contrasts with the last meeting when the MPC voted 7 to 2 to keep the rate unchanged, with the two dissenting members advocating a reduction to 5%. This marks the first rate cut by the Bank of England since August of last year, which followed 14 consecutive rate increases.
Mounting speculation on CGT rise as Reeves set to speak
Speculation has increased over the weekend that the Chancellor is considering raising capital gains tax to fund public spending. Reports suggest that Rachel Reeves is contemplating aligning CGT rates with income tax, a proposal previously explored by the Office for Tax Simplification in 2020. Reeves is scheduled to give a speech at 3:30 pm today, where she is expected to address a £20 billion gap in public finances and announce the date for the upcoming Budget.
LSL appoints Hollingworth to lead distribution role
Emma Hollingworth will join LSL Group as Chief Distribution Officer for its financial services division in September. She comes from HSBC, where she was Head of Specialist Lending, and has previously worked at MPowered Mortgages, Bluestone Mortgages, and Mortgage Advice Bureau. Richard Howells, Managing Director of LSL Group, stated that Hollingworth’s appointment is a crucial part of the ongoing transformation of the business.
Budget to fall on 30 Oct as Reeves slams £22bn ‘black hole’
The Chancellor announced that Labour’s first Budget in over 14 years will be delivered on October 30. In her speech, Rachel Reeves criticized the Conservatives for “covering up” a £22 billion gap in public finances. Speaking in Parliament, she condemned the previous government’s actions as “unforgivable” and accused them of giving the public “false hope” with unfunded promises. Reeves stated that she would need to make “difficult decisions” to stabilize the economy in her upcoming Budget. There is growing speculation that she may increase capital gains tax to align it with income tax as a revenue-raising measure.
Mortgage borrowing doubles to £2.7bn in June: BoE
Mortgage borrowing more than doubled to £2.7 billion in June from £1.3 billion the previous month, according to the latest Bank of England data. The annual growth rate for net mortgage lending increased to 0.5% in June, up from 0.3% in May, continuing a recent upward trend, as noted in the central bank’s June Money and Credit report. Mortgage approvals for house purchases, a key indicator of future borrowing, remained stable at 60,000 in June. However, remortgaging approvals fell to 27,500 from 29,300 in May.
Santander launches improved broker website
Santander has launched an enhanced website for brokers, effective July 29. The upgraded site features an improved search facility that allows brokers to find information using industry-recognized terms, even if they differ across lenders. For instance, searching for ‘rate switch’ will also yield results for ‘product transfer’. Additionally, the lender’s homepage now includes more service levels.
Halifax Intermediaries cuts rates by up to 33bps
Halifax Intermediaries will implement rate reductions of up to 33 basis points across various product ranges, effective August 1. Remortgage products will benefit from extended completion and end dates, as well as reduced rates. The five-year fixed rate for 80% loan-to-value (LTV) mortgages has been cut from 5.25% to 4.93%, while the two-year fixed rate for 80% LTV mortgages has decreased from 5.94% to 5.62%. Both options have no fees and are available for loan amounts between £25,000 and £2 million.
