Mortgage market prospects

A daily monitor of mortgage market activity has reported “significant volumes” of business across the sector, even over the weekend. Mortgage technology firm Twenty7Tec is running a daily market snapshot service which shows the volume of searches for the week ending last Sunday, May 17, was up 27% on the previous week and up 43% on four weeks ago.

The number of online searches for purchase mortgages (as opposed to re-mortgage loans) on Sunday May 17 was up 64% on the same day a week earlier. Commentators believe we are starting to see significant volumes return to the market – with searches for purchase mortgages in particular rapidly gaining pace. Searches for purchases are now at 44% of pre-lockdown highs, up from lows of 15.6% in mid- April. It’s hard to overstate the effect that last week’s reopening announcement has had on the market. It’s the first week that we have ever seen where activity on the Wednesday, Thursday and Friday all outperformed the Monday and Tuesday.

This weekend, for the first time since lockdown, purchase searches overtook re-mortgages searches. The government put the number of home moves frozen by lockdown at 450,000. While housing market activity is expected to revive in the short term as this demand is released, the outlook for the longer term is less clear given the uncertain impact of the virus on employment, earnings and confidence among buyers and sellers.