According to data from the criteria search system, the search for 'Temporary Maximum LTV Restrictions' was top of brokers' lists for the six month running, reflecting a year where many lenders have scaled back or halted high LTV lending.
Terms relating to coronavirus have 'dominated' broker criteria searches for six consecutive months in residential, second charges and bridging loans. This offers strong indicators that the housing market continues to be impacted by the pandemic as lenders remain cautious. The uncertainty that Covid-19 has left within the market, has meant that restrictions continue to be placed on LTVs and the number of products offered to consumers.
In the residential market, this was enhanced by the continued searches for ‘Covid-19: Furloughed Workers’ which has featured prominently in the residential market since April. Searches for this term are expected to rise before the furlough scheme comes to an end in October, as buyers rush to gain mortgage approval before facing job losses.
In buy-to-let, canny investors are driving the trend for searches relating to holiday lets - which stayed in the top five search results for August, driven by the stamp duty holiday and increasing numbers of UK families choosing to remain in the UK and avoid potential quarantine following an overseas break.
Elsewhere in borrower demographics, a spike in searches for ‘Debt Management Plan – Ongoing / Current’ was evident in the equity release market, suggesting older borrowers may be feeling the financial effects of the pandemic as deeply as their younger counterparts.
Matthew Corker, lender relationship manager at Knowledge Bank, commented:
“Broker criteria searches in August provided clear signs that the housing market is still being affected by Covid-19.
“It is evident that there is growing concern around mortgage eligibility with consumers across the board, particularly those looking for higher LTV mortgages. The looming end to the furlough scheme also continues to feature prominently as those on furlough attempt to get mortgages approved before their furlough ends.
“In a similar vein, more first-time buyers are increasingly reliant on family members to give them a helping hand to get on to the property ladder, which is impacting the maximum age at the end of the mortgage and may also have a longer-term impact on equity release options.
“Coronavirus has impacted consumer habits, and we are beginning to see the wider trends taking place as a result of this with buyers and lenders alike.”
