Mortgage Strategy’s Top 10 Stories of the Week
This week: Nationwide predicts a ‘volatile’ start to 2025, while TSB and HSBC announce rate changes across their offerings.
Nationwide forecasts ‘volatile’ start to 2025
Nationwide predicted a “volatile” start to 2025 due to upcoming stamp duty changes but expected house prices to rise by 2-4%. The bank’s chief economist, Robert Gardner, noted that the changes would prompt a rush of transactions in early 2025, particularly in March, followed by a slowdown as seen with previous stamp duty adjustments. Despite affordability challenges, house prices remained resilient in 2024. Gardner highlighted mortgage market difficulties, with high rates making affordability a struggle for many prospective buyers.
TSB and HSBC reveal rate changes across range
TSB announced a range of rate changes across its residential, product transfer, and additional borrowing ranges. For residential mortgages, two-year fixed remortgage rates at 80-85% LTV were reduced by up to 0.25%. Five-year fixed remortgage rates at 75% LTV decreased by 0.05%. TSB also made similar cuts for product transfers and additional borrowing. HSBC announced rate cuts for first-time buyers, reducing two-year and five-year Fixed Fee Saver rates at 60%, 70%, and 75% LTV, while increasing rates at higher LTVs.
Industry reaction to BoE rate hold
The Bank of England’s Monetary Policy Committee held interest rates at 4.75%, following two rate cuts earlier in the year. Industry reactions varied, with some expecting rate reductions in 2025. CHL Mortgages’ Ross Turrell noted that rate cuts had recently boosted the mortgage market but concerns about inflation made an immediate reduction unlikely. Market Financial Solution’s Paresh Raja suggested the market was stronger than a year ago, while My Mortgage Angel’s Sam Lindsay forecasted gradual rate decreases in early 2025.
Mortgage lending set to rise 11% in 2025: UK Finance
FCA’s plans for review of vulnerability are ‘no surprise’: MorganAsh’s Gething
MorganAsh’s Andrew Gething commented that the FCA’s plan to review how firms handle customer vulnerability came as “no surprise.” This followed the FCA’s review of 180 firms’ annual Consumer Duty reports, focusing on outcomes, data quality, customer analysis, and culture. Gething highlighted concerns about firms underreporting vulnerable customers, urging them to be proactive in assessing vulnerability beyond financial factors. He emphasized the importance of good data and technology to ensure compliance, stressing that vulnerability monitoring should be a shared responsibility between manufacturers and brokers.
Skipton International CEO Coupe to retire in 2025
Skipton International CEO Jim Coupe announced his retirement in 2025 after 15 years with the company. He will remain in the role until summer, with a search for his successor underway. Having joined as commercial director in 2009, Coupe later became managing director and CEO in 2023. He has been instrumental in the company’s growth, particularly after the 2009 merger. Skipton Group CEO Stuart Haire praised Coupe’s contribution, calling him a key driver behind Skipton International’s success in the mortgage and savings markets.
UK housing market beat expectations in 2024: Halifax
The UK housing market surpassed expectations in 2024, supported by lower mortgage rates and strong wage growth, according to Halifax. Property prices reached a record £298,083, with a 4.8% annual growth. Transaction volumes returned to pre-pandemic levels, though affordability remained challenging for many buyers. Halifax forecasts modest house price growth of 0% to 3% in 2025 and expects a small increase in transactions. Uncertainty remains high due to the economic environment. Buyers may act quickly to avoid anticipated Stamp Duty rises.
Bank of England holds rate at 4.75%
News Analysis: Conditional selling causes fury
Mortgage brokers have raised concerns over the increasing practice of conditional selling by estate agents, which prevents potential buyers from viewing properties unless they consult the agency’s in-house adviser or solicitor. This has caused stress, confusion, and, in some cases, misadvice to borrowers, even those with mortgage approval. Brokers claim this practice has worsened recently despite previous warnings and legislation. Conditional selling has been linked to higher costs for borrowers, with many advisors now advising clients to avoid agents’ suggested advisers.
Finova strengthens senior leadership team
Finova announced changes to its senior leadership team, with Paraag Davé transitioning from executive chairman to CEO of the enlarged company. Additionally, Rowan Clayton was promoted to chief product officer (CPO), having contributed significantly to product development over his 14 years at Finova. Davé highlighted the company’s focus on innovation and sustainable growth, aiming to strengthen technology solutions for lenders and savings providers. With the backing of Bain Capital Tech, Finova is positioned to meet evolving industry challenges.
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