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Mortgage lender confidence

ended 14. October 2022

According to PA Media, "mortgage lenders should feel confidence about putting more products back on the market following Prime Minister Liz Truss’s sacking of Kwasi Kwarteng as Chancellor and tax U-turn, according to a housing market expert.

Lawrence Bowles, director of research at Savills, said that while the housing market will still need to adjust to a higher interest rate environment, some downward pressure on house sales and prices will be tempered.

He said: “Confirmation, as well as news of (Mr Kwarteng’s) dismissal as Chancellor, should help to push yields down further, allowing the Bank of England to slow its pace of monetary tightening and easing pressure on mortgage costs.

“And with more breathing room, lenders should feel the confidence to put more products back out to the market. As a result, we believe that some of the existing downward pressure on house prices and transactions will be tempered.

One question, do you agree?

4 responses from the Newspage community

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Riz Malik
Independent Financial Adviser at R3 Wealth
Every bone in my body wants to see a positive reaction from the financial markets which feeds through into mortgage pricing. However, had the second u-turn been the one we were hoping for and expecting, the probability of a better outcome would have been greater. Kwasi's dismissal was only the first of a number of steps to regain confidence in the current administration. Roll on Halloween if Liz makes it until then.
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Rob Gill
Managing Director at Altura Mortgage Finance
Sacking Kwasi Kwarteng seems to have had little affect on the markets who are very aware the mini-budget was as much Liz Truss’s doing as her Chancellors. As things stand it doesn’t look to have been enough to rebuild market confidence in U.K. leadership.
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Graham Cox
Director at Bridging Hub
Gilt yields have risen fron 3.9% before Truss' press conference to 4.2% after. So if the plan was to reassure the markets it seems to have had the opposite effect. The PM seems to have the reverse midas touch. I can't see interest and mortgage rates falling any time soon.
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Jonathan Burridge
Founding Adviser at We Are Money
This isnt is a matter of a switch-flick back "to the good old days". There will remain questions over the wisdom of the initial decisions and therefore how robust will future moves be? What confidence is there in the leadership, which still remains intact? I expect that lenders will be waiting to see what impact todays events will have and they are unlikely to rush to reprice. I am afraid that confidence is quickly lost and slowly gained. It will take some Barnham-like maneuvers to get the audience clapping.