Duncan Farmer has found some good news and pockets of optimism in the current mayhem.
The continuing chaos of Brexit and the added mayhem surrounding the Conservative Party leadership contest has thrown a big wet blanket over the property market as anyone trying to sell will tell you. However, for anyone trying to buy there are pockets of optimism: news that the US federal Reserve is cutting interest rates over there may influence policy over here and individual lenders are so keen for what little business there is out there that they are working harder for customers.
News that American rate setters are cutting the cost of borrowing may not necessarily lead to a cut in rates by the Bank of England’s monetary policy committee, but may well put paid to any suggestions that our rates will have to rise.
At opposite ends of the scale in the marketplace there is good news for buyers. For anyone looking to borrow at least £3 million, Deutsche Bank Wealth Management has launched a service to private banking clients in the UK. The new scheme will also cover remortgaging and equity release.
The bank said that it would “dry lend”, offering large mortgages without requiring assets under management. Michael Morley, head of Deutsche Bank Wealth Management in the UK, said: “Our sophisticated clients are increasingly coming to us looking for higher value borrowing for principal private residences, high value buy-to-let properties and commercial buildings here. We’ll now be able to meet the full spectrum of their needs in the UK, putting our deep international experience and investment banking capabilities to work on their behalf.”
At the other end of the scale Sainsbury’s Bank has announced improvements to its affordability calculations, increasing the overall loan amount brokers will now be able to offer their clients.
The changes could see a £40,000 average increase in lending amount for joint applications at 65 per cent of loan to value.
Single applicants borrowing at 70 per cent loan to value could increase their maximum lending amount by £30,000 and joint first-time buyer applicants could see a £47,000 rise in maximum lending at 90 per cent loan to value.
David Crooke, head of intermediaries at Sainsbury’s Bank, said: “This announcement illustrates that we will always listen to the needs of our broker network and be responsive to their feedback. Our new affordability calculations will make it easier for people to do business with us.”