Mortgage Approval Downtrend What It Means for You

22nd November 2023
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The recent data from the Bank of England regarding mortgage approvals presents a notable trend that could impact homeowners looking to sell their properties. At Anthony Jones Properties, we want to ensure you make an informed decision at all times, so here’s a breakdown of the findings and what they could mean for sellers in these regions:


Declining Mortgage Approvals


The figures indicate a continued decline in mortgage approvals over the last few months, with September experiencing a 4.6% decrease from August, following an 8.4% drop between July and August. This trend marks an eight-month low, with only 43,300 net approvals for house purchases in September.


Potential Implications


A decline in mortgage approvals generally suggests a lower number of buyers entering the market. This could be due to a variety of factors including stricter lending criteria, economic uncertainties, or potential buyers adopting a wait-and-see approach amidst fluctuating market conditions.


Market Perception


The decreasing trend in mortgage approvals might signal caution to prospective buyers and could potentially impact sellers’ expectations and the urgency among buyers.


Strategies for Home Sellers

Some strategies we recommend for home sellers, and which we put into practice for our clients, include:


Pricing Correctly: In a market where mortgage approvals are dwindling, it becomes even more essential to price your property accurately to attract serious buyers.

Enhanced Marketing: Upscale your marketing efforts to reach a wider audience and highlight the unique selling points of your property.

Engage with a Professional: Employing the services of a knowledgeable estate agent can provide invaluable insights and strategies to navigate through the current market scenario.

Explore Alternative Buyer Pools: Look beyond the traditional buyer market. For instance, investors or cash buyers may not be impacted by the mortgage approval trend.

Offer Incentives: Offering incentives such as covering closing costs or including warranties can make your property more attractive to potential buyers.

Staying Informed: Keeping abreast of mortgage lending trends and other economic factors can empower sellers with the knowledge required to make informed decisions.


Industry specialists have their say


Rosie Hooper, chartered financial planner at Quilter, spoke about this situation, saying: “Many people with house purchase ambitions are opting to sit on their hands for the moment to try to achieve a combination of lower house prices and hopefully lower mortgage costs.  Mortgage rates have been steadily dropping but they are still eye-wateringly expensive. In fact, the ‘effective’ interest rate – the actual interest paid – on newly drawn mortgages saw a 19 basis point increase and now sits at 5.01%.”



Jason Tebb, chief executive of OnTheMarket, also spoke about this matter, saying: “The pause in rate hikes in September was welcome, with borrowers hoping that base rate is finally at, or very close to, its peak. With inflation sticking at 6.7% last month, all eyes will be on the Bank of England to see whether it raises rates again this week, further impacting the affordability of those relying on mortgages.”


Jason continued by saying: “Despite all these headwinds, those buyers who are committed to moving are getting on with it, with our own data for September indicating that sentiment remains remarkably stable. However, buyers are highly price-sensitive, so sellers looking to transact this side of Christmas must price sensibly.”


Contact Anthony Jones for all Darlington property matters


If you are looking for help with any matter of the Darlington property market, it is best to speak to property professionals. No one knows for sure what is going to happen next, so we won’t claim to have all the answers, but the Anthony Jones team is keen to help you as best we can. If you would like to contact us over housing matters, please call us today on 01325 776424.


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