Following the UK finance figures this morning, Richard Pike, Phoebus Software sales and marketing director, said: “It is always interesting to look back, and of course what we see for Q3 in the mortgage market was a huge rise in activity that really couldn’t have been predicted. The stimulus of the stamp duty payment holiday that the government hoped would give the market a boost after lockdown, did exactly that. There was also so much pent up demand when we came out of the first lockdown, which shocked estate agents, advisers and lenders alike.
“With the industry currently lobbying the government regarding the cut-off date for the stamp duty holiday, we hope to see some decision shortly which will prevent applications in the pipeline from falling off the cliff on March 31st.
“As we head into 2021 and unemployment figures inevitably rise, the question of mortgage repayments will become an issue. Lenders will need to be prepared and forbearance will no doubt be top of the government’s list of requirements. To that end lenders should now be training and recruiting as their collections departments will no doubt be under some pressure.”
Jonathan Sealey, Hope Capital’s CEO, said: “There’s no doubt that the stamp duty holiday has been imperative in keeping the economy buoyant. The strong recovery of house purchase lending in Q3 has certainly been aided by the continued release of pent up demand within the property market. This has been boosted by the stamp duty holiday, inspiring people to bring transactions forward and make the most of the temporarily increased nil rate bands.
“The recent news of a vaccine being rolled out is promising, giving a glimmer of hope for a return to normality in the months to come. However, the future of the housing market and wider economy is not only down to returning to normal life, it is also dependent on the extent of the invisible damage already done.
“When the furlough scheme comes to an end, we will have a clearer outlook on this, and we may yet see high redundancy rates. This is when we could see disruption in the housing market, as households will likely express caution when it comes to borrowing.
“As we look forward, we can only hope that the stamp duty holiday has been enough of a stimulus to encourage property transactions until Q1 next year and that when it ends, the wider economy is in a strong enough position to keep the market moving.”