The UK property market: 2014 review

As the year draws to an end, predictions are starting to take shape for the property market's prospects, with the likes of Savills and Marsh & Parsons both forecasting solid years overall after a shaky start. But before we even get to 2015, how has this year performed and where does the property market sit now?

Generally speaking, it has been a strong year for property, with the latest report from LSL Property Services stating that it has been the best 12 months since 2005, with economic recovery and positive sentiment feeding into strong demand and subsequently lots of activity.

Residential

The residential property market has generally had a very strong year, and although price rises have started to cool off towards the end of the year, they have been climbing for the majority of 2014.

In November, the Acadata index showed that property prices across England and Wales climbed by 0.8 per cent on average.

This took the average house price to more than £280,000 for the first time ever, and meant that the annual rate of increase stood at some 11.3 per cent, a strong year indeed for the sector.

The rental market has also enjoyed a strong 2014, and the most recent Home Let Index indicated that rental costs were up by 8.7 per cent month-on-month in November and 11.7 per cent compared to the same month a year earlier.

Despite a swelling of new properties coming into this market, demand has remained high throughout the year, which has given landlords a boost in confidence.

Commercial

The commercial market has lagged behind residential property in recent years, but this hasn't been the case in 2014, as it has rebounded to become the most profitable asset of the year.

According to Lloyds Bank, up until November, returns for the commercial property sector sat at 20.1 per cent, which pushed it ahead of last year's best asset, equities, where gains were 12.8 per cent for 2014.

Source: www.invezz.com

More than 50% of UK Landlords will invest in more properties in the next 12 months

More than 50% of UK Landlords will invest in more properties in the next 12 months

Over half of landlords in the UK are looking to buy more property in 2015 and are feeling bullish about the new year, according to a new study.

The optimism is fuelled by the growth in demand for rental property, falling rent arrears and rising rent prices during the last 12 months, says the research from online letting agent PropertyLetByUs.


The survey also found that 50% of landlords have achieved yields of between 6% and 8%, 10% of landlords have achieved yields of over 8% and 40% of landlords have achieved yields of 4%, over the last 12 months.

The firm says that rising property prices has meant that almost a third of landlords are enjoying sizeable equity in their property, with a loan to value ratio of between 30% and 40%.

It also says that with booming tenant demand, it is no surprise that only a quarter of landlords are planning to cash in on rising property prices by selling some of the their buy to let properties in 2015.

‘Landlords have enjoyed good rental yields and increased asset values in 2014,’ said Jane Morris, managing director of PropertyLetByUs, adding that they have also experienced high levels of tenant demand, with just 3% reporting that it is declining, according to recent research from Paragon Mortgages.

The study shows that overall, 41% of landlords surveyed said tenant demand was growing or booming and 51% said demand was stable. Home ownership has fallen to its lowest level for a quarter of a century and with property prices continuing to increase, tenant demand is set to grow during 2015 and beyond.

‘Over the last year, we have seen a surge in landlords across the UK using our website, particularly in the North, London and the South East. We have also seen a sharp rise in the website’s advertised properties, up by 50% since May 2014,’ explained Morris.

Source: www.landlordexpert.co.uk

Buy-to-let property returns rising across much of the UK

The chances are that buy-to-let property investments are earning more money for their owners now than at this point last year.

New research from Home Let shows nine out of the 12 UK regions experienced a year-on-year rental price rise in November.

According to the monthly index, the average property investor is earning £874 gross rent a month from each of their assets. Buy-to-let property in Scotland is currently the best performing in the UK, with rental prices rising 11.7% over the course of 2014.

Historically, this time of year sees rental prices dip from the peak early autumn months. September and October rental figures are buoyed by the large number of new tenants moving into student accommodation, but Home Let explained the latest figures show the underlying strength of the UK’s buy-to-let sector.

Martin Totty, Chief Executive Officer of the Barbon Insurance Group, of which Home Let is part, said: “The outlook for the private rented sector remains positive for several reasons, the pace of house building is unlikely to have a significant effect on the supply of property to buy or to rent in the short term, high house prices, and a mortgage market where lending criteria remains constrained, are combining to ensure that the demand from tenants needing rented accommodation remains strong.”

Earlier research by both Knight Frank and Savills also revealed that many people are actively opting to live in rented accommodation even though they can afford to purchase their own property, citing the increased flexibility this brings to their lifestyle as the decisive factor.

Source: www.selectproperty.com

Rent up 8.3pc in November

Rental prices are 8.3% higher across the UK in November 2014, at £874 per month, compared to the same month last year when the average UK rent was £807, the November HomeLet Rental Index have revealed.

Nine out of 12 UK regions have recorded higher rental prices in November 2014 compared to the same month last year, even accounting for a 0.6% decrease in UK average rental prices since October 2014.

Regions that have experienced the highest growth compared to this time last year include Scotland, Greater London, and the West Midlands, with rental prices 11.7%, 11% and 8.7% higher than this time last year, respectively.

Despite the strong annual comparison figures, the HomeLet Rental Index has recorded an ‘autumn dip' in rental prices, with rents agreed on new tenancies falling in the majority of UK regions in September and October this year.

This month, that trend continues with all regions of the UK with the exception of Scotland, the East Midlands and the South West recording lower prices in November than in October 2014.

Scotland recorded a monthly increase in rental prices of 8.7%, with the East Midlands and the South West recording monthly increases of 1.5% and 1.4% respectively.

The recent dip in prices reflects typical seasonal movement in the rental market and sits within the context of a market that remains strong.

Annually, only three regions of the UK recorded lower rental prices in November 2014 compared to the same month last year: the North West dropped -3.6%; the North East -2.5% and Wales -2%.

Martin Totty, Barbon insurance Group's chief executive officer, said: "We see the autumn's moderation in rental growth as broadly in line with the typical seasonal effect that often sees rental prices balance or even slip into reverse in many areas of the country at this time of year.

"The outlook for the private rented sector remains positive for several reasons - the pace of housebuilding is unlikely to have a significant effect on the supply of property to buy or to rent in the short term, high house prices, and a mortgage market where lending criteria remains constrained, are combining to ensure that the demand from tenants needing rented accommodation remains strong.

"In terms of seasonal highs we see Scotland bucking the trend of the rest of the country, the rapid growth in the Scottish rentals market reflects the strength of the economy north of the border – particularly in oil-rich Aberdeen, which has a thriving rentals sector, but also in other Scottish cities and throughout the country.

"A report published this week shows Scotland now has the highest employment and economic activity rates – and the lowest unemployment rate – of the any of the four nations of the UK."

Source: www.mortgageintroducer.com

Top buy-to-let hot spots in Britain

When buying property to rent, try Southampton, Manchester and Nottingham (and avoid London) to reap a princely payback .

Expats looking to buy property in the UK to rent out should be aware of the wide differences in rental income across the country.


For example, if you became a buy-to-let investor in Southampton rental yields are as high as 8.73 per cent whereas some parts of London only offer yields of 2.7 per cent (Hammersmith and Fulham) as property prices have rocketed so much in parts of the capital. By being out of the UK an expat can lose touch with escalating property prices, which have a major impact on the rental yields.


The "yield" is the annual return, calculated by expressing a year's rental income as a percentage of how much the property cost.

According to research from HSBC, Southampton took the top spot for the highest rents for buy-to-let investors while in second place was Manchester at 7.98 per cent followed by Nottingham in third spot with 7.67 per cent. No London borough made it into the top 10.

Peter Dockar, head of mortgages at HSBC, said: "Landlords outside of London are reaping the benefit as young professionals say goodbye to capital living in favour of more affordable commuter towns."

The highest average yield available in London was Newham, east London, at 6 per cent.

However, London is still very popular among foreign investors and expats alike given its stable prices and strong rental demand. While rental yields have been squeezed, capital appreciation has been strong in recent years. For buy-to-let landlords only interested in the highest rental yields it may pay to look further afield. Research by Knight Frank shows that gross yields ranged from 4.3 per cent in central London to 8.2 per cent in Leeds this year.

For those interested in capital appreciation alongside rental yields, Hamptons International ranks Cambridge as the number one buy-to-let spot for landlords. Johnny Morris, head of research at Hamptons International, said: "Cambridge has seen particularly strong house price growth in the last year, which makes up for a fairly average yield. The continued growth of the city means that it’s a safe bet, albeit at a high entry price."

Experts predict that house price growth is set to ease in the coming months, making the yield of the rental income all the more important in 2015. With rental growth set to increase in 2015 yields should be increasing slightly too.

According to HSBC’s hot spots, many northern cities make it into the top locations for rental yields including Nottingham, Manchester, Blackpool and Hull. This is attributed to their relatively low house prices combined with strong demand for rental property from students and young professionals.

One city seeing rapidly rising yields is Reading which is home to many multinational companies and a large university. The prospect of Crossrail and the redevelopment of much of the town centre is expected to be a boon for the area in the coming years. Crossrail is a high-speed trainline that will provide a new east-west line across Greater London and its surrounding area. It is due to be completed by 2018.

Another popular property investment among expats is student accommodation. But Mr Morris cautioned against buying a property in a university town. He said: ‘’Expats might want to think twice before dipping their toe into the student market, as student properties can be difficult to manage well. A mid-market two- or three-bedroom property in an area popular with young professionals will generally be much easier to manage from a distance.’’

Top 10 buy-to-let hot spots by rental yield

1. Southampton 8.73 per cent
2. Manchester 7.98 per cent
3. Nottingham 7.67 per cent
4. Blackpool 7.63 per cent
5. Kingston upon Hull 7.47 per cent
6. Coventry 7.09 per cent
7. Oxford 7.02 per cent
8. Portsmouth 6.5 per cent
9. Liverpool 6.5 per cent
10. Cambridge 6.48 per cent

Source: www.telegraph.co.uk

Stamp duty reforms to boost UK house sales

Stamp duty reform will boost UK house sales by as much as 5 per cent during the next year, according to a survey of estate agents.

The findings by the Royal Institution of Chartered Surveyors are based on a snap poll after George Osborne’s surprise announcement last week that he is scrapping the current system following a recent softening of the housing market.

 The Rics survey forecast that the new sliding scale for the tax on property purchases could raise the number of transactions by 2–5 per cent during the next 12 months.

This contrasts with the most recent monthly Rics survey, conducted just before the Autumn Statement, which showed that house price growth dipped for the sixth consecutive month in November, recording the slowest pace of growth since May last year.

That comes against a backdrop of estate agents reporting both weaker demand for the fifth consecutive month — with 15 per cent more surveyors reporting a decline in new buyer enquiries — and a fourth consecutive fall in supply.

The survey, which has been running since January 1978, suggested supply is very tight with the number of residential properties for sale at its second-lowest level since records began — with an average of 56 properties on the books per branch.

The findings mirror other surveys that show that house price growth is slowing across the country.

“The stamp duty reform could reverse the softer trend in buyer enquiries that has been visible in recent months but a critical issue in terms of how it plays out with prices is whether it also encourages more vendors to consider putting their properties back on the market,” said Simon Rubinsohn, Rics chief economist.

“The expectation from members that transactions could increase by up to 5 per cent over the next year on the back of this measure suggests that there is a belief that supply will indeed respond to the tax change.”

Across the country, price growth was strongest in Scotland and southwest England, and weakest in the north of England and London in November. Recent forward-looking data has suggested that the booming housing market in the capital was beginning to soften.

Recent research for the Financial Times found that London’s commuter belt and its cheapest boroughs would be the biggest beneficiaries of the stamp duty reform.

Source: www.ft.com

Buy-to-let lending at highest level since 2008

Buy-to-let lending jumped from £5.9bn in the third quarter of 2013 to £8bn in the corresponding period this year - the highest quarterly amount since the crash of 2008, official data from the Bank of England has shown.


Lenders have piled back into the rental market over the last year, considered risky during the downturn, as stricter mortgage regulations have hurt their profits.


Andrew Montlake of mortgage broker Coreco said: "The likes of Natwest and Santander have got back into the buy-to-let market. This has driven rates down to levels never seen before."


This buy-to-let surge contributed to the quarterly rise of 0.5pc in all residential loans outstanding in the third quarter of the year to £1,256 billion, the Bank of England reported.


Jonathan Harris, managing partner of Anderson Harris, said: "There is a general feeling that buy-to-let lending is a viable option again, although it is not the free for all of 2006/7.

"The rigours of the mortgage market review, introduced in April, and the capping of the number of high loan-to-value mortgages, have restricted the money coming into the lenders hence the focus on buy-to-let."

The increase in credit availability for buy-to-let mortgages has coincided with an increase in the number of wannabe-landlords.

People are holding on to their urban home, remortgaging it, switching to a buy-to-let product, taking out some equity and using that to buy a larger country property, Mr Montlake said.

"We are seeing this particularly in London as homeowners see the benefit of keeping London property as a long term investment." Despite a short-term fall in London values, many are counting on the future capital appreciation on London property.

Source: www.telegraph.co.uk

How stamp duty overhaul will save buy-to-let investors £50m each year

 

Britain's increasingly active landlords are likely to benefit from George Osborne's overhaul of stamp duty - with the cut adding to the array of tax reliefs they already enjoy.


The majority of landlords buy cheaper properties where the impact of the new stamp duty regime is especially beneficial. Few buy properties costing more than the £937,000 threshold above which the new duty system becomes more onerous.

Figures from lenders' trade body the Council of Mortgage Lenders (CML) show a relentless increase in the number of loans taken out by landlords using the cash to make new purchases. Since 2010, when 49,000 buy-to-let loans were granted, the number has more than doubled. Currently buy-to-let loans are being taken out at a rate of 9,000 per month - over 100,000 per year.

Using the CML data it is possible to calculate the value of the average buy-to-let mortgage being used to purchase a property - as opposed to remortgaging an existing one - at £124,000. Assuming a typical borrowing equal to 60pc of the property price gives an average purchase price of £200,000.

igures from lenders' trade body the Council of Mortgage Lenders (CML) show a relentless increase in the number of loans taken out by landlords using the cash to make new purchases. Since 2010, when 49,000 buy-to-let loans were granted, the number has more than doubled. Currently buy-to-let loans are being taken out at a rate of 9,000 per month - over 100,000 per year.

Using the CML data it is possible to calculate the value of the average buy-to-let mortgage being used to purchase a property - as opposed to remortgaging an existing one - at £124,000. Assuming a typical borrowing equal to 60pc of the property price gives an average purchase price of £200,000.

At that level, stamp duty savings between the old and new regimes amount to approximately £500 per transaction. This gives a total annual saving on landlord purchases, assuming they continue at the current rate, of around £50m. In the graph below stamp duty has been calculated on the basis of an average £200,000 purchase price. The number of transactions in 2015 is left unchanged at an estimated 100,000, which is the current level based on the CML's figures for the first three quarters of 2014.

Landlord groups have been quick to welcome the news. The biggest body representing the private rented sector, the National Landlords Association, hailed the changes as a "big win". A spokesman said: "This is welcome news and is something the NLA have been lobbying hard on for years. The introduction of a straightforward marginal system of taxation will mean private landlords will now not only face lower costs when acquiring property, but also have funds to implement property improvements and keep rents down."

In recent years landlords have been focusing increasingly on northern towns and regions as price rises in the South have pushed down rental yields. The stamp duty cuts could accelerate this trend.

Ajay Jagota of sales and lettings firm KIS, based in the North East of England, said: "With North East properties typically much closer to the £125,000 threshold than in other parts of the country, our region is likely to be one where buyers benefit the most.

"For the buy-to-let investor this could mean both a bigger and faster return on their investment and extra capital to invest in improving the condition of their property."

Some commentators continue to see value in costlier, southern regions, including London. Stephen Ludlow, of sales and lettings agency Ludlowthompson, which specialises in cheaper inner areas of the capital, said: "The changes in stamp duty will see the biggest increase in net returns for more modestly priced investments - smaller properties in Zone 3 of London, city centre apartments, flats above shops, ex-local authority property and property in secondary locations.

"The reforms could encourage those who may have been delaying their purchase until after the election to reconsider."

Groups supporting those struggling to buy property responded with further calls to limit landlord tax breaks. Angus Hanton of the Intergenerational Foundation, a think tank which seeks to promote a fair distribution of social wealth and benefits across age groups, said: "The measures on stamp duty are welcome but what younger people need is the Government to target lower housing costs through fewer tax concessions for landlords and more home building."

Source: www.telegraph.co.uk

Private rental sector identified as a growth area in UK property markets

 The changing lifestyles of people aged under 35 and a shift in sentiment towards property ownership are set to contribute to a surge in the UK’s private rental sector, it is claimed.

It could actually be the solution to the country’s housing problems, according to experts speaking at an annual property seminar hosted by Midlands law firm Lodders Solicitors.



‘We need to have a shift in attitudes towards renting, and the private rental sector could be the solution to the UK’s housing problems,’ said Jon Bellfield, managing director of the Barberry Group, a privately owned property development and investment company.



The event’s speakers independently identified the private rental sector as an important and emerging sector, and where the growth is likely to be. Indeed, the sector could account for 30% of the housing stock by 2020, the seminar was told.

It heard that the UK is building fewer new residential homes than in 1926, and this short supply is also contributing to the creation of a large rental market, with the difficulty for first time buyers to enter the property market fuelling demand, although the Help to Buy scheme has had a positive impact.

People are changing how they want to live and use their town and city centres, and the potential challenge is for developers to build the accommodation these people want, to include quality apartments complete with concierge, secure internet purchase rooms, gym and pool facilities, and easy access to bars, restaurants and shops.

Recent research by Savills, for example, has revealed an increase in development activity across the country, and rising demand for land, with values starting to increase. Amongst the under 35s, there’s a growing shift in sentiment around property ownership, which they see as not as important as it was four or five years ago.

‘We expect the private rented sector to grow faster as mortgages are constrained and become less affordable and the annual housing costs for the under 35s is already dominated by private rents,’ said Simon Horan, head of residential development in Birmingham at Savills.

Source: www.propertywire.com

UK residential property tax changes widely welcomed

Sweeping reforms to the Stamp Duty Land Tax (SDLT) in the UK have been announced which take effect immediately and will mean many people, especially first time buyers, will pay less property tax.
The reform announced by the Chancellor of the Exchequer George Osborne abolishes the previous archaic bandings with a more progressive system designed to help young professionals and families get on the housing ladder.
 

The new charge will only apply on a portion of value that is above each new level. So there will be no SDLT up to £125,000, 2% up to £250,000, 5% up to £925,000, 10% up to £1.5 million and 12% over £1.5 million.

Osborne pointed out that only on purchases of more than £937,000 will buyers end up paying more than they have done. It is also likely that the chances of a mansion tax should be introduced are much diminished.

The move has been widely welcomed by the property industry with experts saying it was long overdue. ‘The abolition of the archaic slab system will take the sting out of the tail for thousands of buyers on the lower rungs of the ladder. The new graduated system should help brighten the UK housing recovery in regions outside of London, where property prices are still battling back to pre-recession levels,’ said Peter Rollings, chief executive of Marsh & Parsons.

But he pointed out that it will add to the weight of the tax burden shouldered by those buying more expensive homes. ‘In prime parts of London, where 56% of property is worth £1 million or more, this will impact a significant proportion of ordinary working families,’ he said.

But he also said that he expects any additional strain on the top tiers of the housing market to be absorbed, and the natural rhythm of the property market won’t be disrupted as buyers investing in prime London property are accustomed to having to pay a higher price than elsewhere across the country and the unparalleled returns and capital growth on offer more than make it worthwhile, so demand won’t be quashed.

‘London property taxes have historically been cheaper compared to other world cities, so this overhaul brings it into line with rival global centres of investment and although, one-off purchase costs are always a bitter pill to swallow, it won’t deter people from snapping up their dream home in a desirable location. Buyers will soon adjust and it will simply become the norm,’ he added.

Peter Mackie, senior partner at independent buying agents Property Vision, pointed out that the change will help 98% of people trying to get onto the property ladder but the impact of the changes will be greater at the lower end of the market where buyers rely on borrowed money, rather than the higher end where if a buyer can afford to pay cash for a £50 million house they can afford the Stamp Duty.

‘The increases in Stamp Duty over £1.5 million will mean that buyers will need to find additional cash to fund the transactional costs which you cannot borrow. The remaining 2% isn’t just made up of overseas buyers increasing their property portfolios in prime central London. The new Stamp Duty bands will have severe effect on the middle market in London, particularly for families looking to buy a relatively modest family home between £1 million and £2 million in areas like Wandsworth, Battersea and Clapham,’ he explained.

‘Buyers will have to stump up as much as £100,000 in Stamp Duty for an ordinary Victorian semi-detached home which will force growing families to either, look at ways to extend their current home or move further out of London to find greater value,’ he added.

Stephanie McMahon, head of research at Strutt & Parker, believes it means there will no longer be talk of introducing a mansion tax. ‘It effectively replaces the need for an annual levy on properties above £2 million,’ she said.

She also believes that in the short term, current ongoing transactions will be impacted. ‘When any new tax is enforced this inevitably causes disruption. However, keeping the status quo was an unlikely outcome. Making this change immediate was sensible as it leaves no room for speculation and will not cause any further uncertainty which has been so damaging to our housing market around taxation changes in recent years. In the long term this new system shouldn’t cause significant market disruption over an extended period of time,’ she explained.

Brendan Cox, managing director of estate agents Waterfords, said the move will provide a much more stable structure and remove the distortion effect that the current system has on the housing market, where properties just above the threshold are difficult to sell.

‘Properties will at last reflect their true value, rather than being priced at a certain level to attract interest. I agree with Mr Osborne that this is a fair and workable reform to the taxation of property that will support those trying to get on the housing ladder,’ he explained.

‘The change will make for an interesting market in 2015. Without the crippling burden of the previous stamp duty rate, many first time buyers and second steppers who have been saving, may suddenly be in a position to raise the deposit required to obtain mortgage finance. This in turn should stimulate increased transactions at the lower end of the market, subsequently having a positive impact on overall market sentiment,’ he concluded.

Source: www.propertywire.com

The best buy-to-let mortgage offers for expats

The UK housing market could be showing signs of cooling down – at least in the capital. For expats working abroad but wanting a base in the UK, this will be good news. But how easy is it to get a mortgage if you work overseas?


It can be hard for a lender to satisfy themselves of the suitability of expats to repay home loans – with the result that some lenders avoid this market totally.


Guy Stephenson, a spokesman for brokers Offshoreonline.org, said: "The requirement to understand a client's financial circumstances in detail means a lender will have to carry out a comprehensive interview, possibly lasting up to two hours. The only way to do this is over the phone which is not that convenient for many expats – for example, if you live in Japan you're nine hours ahead of the UK making calls at a reasonable time difficult."


He added that UK high-street lenders carry out credit searches and identity checks on would-be borrowers. But as many of these checks are automated, expats can easily fail if they aren't on the electoral roll, don't have a UK address or landline or do not use a UK credit card.


Lenders who operate in the expat market tend to look at cases individually and a broker can help to match borrowers to lenders. International Mortgage Plans has an exclusive deal with Ipswich Building Society offering a 3.69pc two-year tracker rate for property occupied by family members. It also has offers from Halifax, Natwest and HSBC – the latter only lends to HSBC Premier customers.


However this summer saw the entry of a new lender to the UK expat market, the Channel Islands-based Skipton International. Jim Coupe, its managing director said Skipton International has already attracted "significant interest from both expatriates and specialist offshore mortgage brokers. We are already anticipating that our targets for next year will be substantially exceeded".


And he added: "We are one of the few lenders in this market and as an offshore bank we are also specialists in dealing with people overseas: we understand expat issues. The feedback we are getting is that applicants appreciated that we have clear criteria so they don't need to waste time talking to us if it's not going to fit."

Its current deals include a discounted variable rate at 3.99pc and a five-year fixed rate at 5.49pc, which Mr Coupe said was proving popular. He added that clients are buying all across the UK. "People naturally buy in areas they know or where they have family or friends who can look after the property."

Source: www.telegraph.co.uk

‘Plenty of momentum left in the property market’

House prices leapt by 12.1% in the 12 months to September, marking the fastest annual growth seen since July 2007, according to official figures.

The average house price across the UK stood at £273,000 in September, which is £1,000 lower than an all-time high recorded in August but still nearly 12% higher than typical values during the previous peak of the market in 2008, the Office for National Statistics (ONS) said.

A typical first-time buyer faces having to pay 13.3% more to get on the property ladder than they did a year ago.

This is the highest annual price increase for first-time buyers since March 2005. Someone climbing the first rung of the property ladder now needs to pay £209,000 on average.

The ONS said house prices are continuing to "increase strongly across the UK, with prices in London again showing the highest growth".

However, there are signs that the pace of house price growth is softening. The ONS said that in a number of regions, including London, prices have fallen back from the record levels seen in August.

On a month-on-month basis, prices across the UK increased by 0.5% between August and September, which is a smaller uplift than a 0.8% monthly rise recorded in August.

House prices in England and Scotland remain above their pre-financial crisis peaks of 2008 but have dipped slightly compared with their levels in August.

But in recent weeks, lenders have unleashed some of their lowest ever mortgage rates onto the market as they look to meet end-of-year targets. Mark Harris, chief executive of mortgage broker SPF Private Clients, said the ONS figures show "there is still plenty of momentum left in the market".

He said: "With the spring likely to be a challenge for the housing market ahead of the general election, lenders will continue offering fantastic deals to entice buyers and those remortgaging."

Housing Minister Brandon Lewis said: “This Government is committed to delivering long-term economic stability. That's why we've pulled out the stops and got Britain building, with planning permission granted for 230,000 homes across England in the last year and housebuilding levels now at their highest since 2007.”

Source: www.theargus.co.uk