Mortgage lenders’ policy change to help borrowers

While this is good news for potential borrowers, there continues to be a shortage of stock for sale, said mortgage broker Pierre Blampied, managing director of SPF Private Clients.

He said two lenders had recently launched 95% loan-to-value mortgages which was a positive move for the market.

‘In addition one lender has increased its affordability model so therefore enabling potential borrowers to increase the amount they can borrow which is another positive step.

‘We are also expecting at least one other lender to undertake a similar strategy change in the near future.’

The recently-published quarterly residential property prices bulletin showed that the average mix adjusted purchase price of a local property was £505,579 in the second quarter of this year, which was 0.8% down on the previous quarter.

But it was still almost 10% higher than in the same period last year.

The mix-adjusted price is a measure of the value of the sales, not a reflection of the values of individual properties.

A total of 297 local transactions were recorded during the quarter, 130 more than the previous quarter and 156 more than the same period in 2020.

There were 35 open market transactions in the second quarter and the raw median price of these was £1,228,500.

The bulletin noted that sales figures for the first quarter of the year were affected by restrictions put in place to slow the spread of Covid-19, as were sales in the second quarter of 2020.

However, while property prices have fallen slightly, average rental prices have continued to rise year on year. In the first quarter of 2021 these were up 10% but rose by just under 16% in the second.

‘From a lending perspective the Guernsey mortgage market is extremely well positioned but we need more stock,’ said Mr Blampied.