Lettings key to agents’ survival if sales slump in 2023

Lettings key to agents’ survival if sales slump in 2023


Todays other news


Data from the mortgage lenders’ trade body UK Finance shows the wisdom of agents having a lettings division.

The body says: “We expect the number of property transactions to fall 21 per cent next year (from around 1.2 million in 2022 to 1 million in 2023), with the value of lending to homeowners dropping 23 per cent, and lending to landlords falling 27 per cent.”

The body adds that despite the anticipated fall in activity, the UK has a strong mortgage and housing market which will remain competitive.

It expects to see strong demand for refinancing and says that – at the moment at least – the vast majority of borrowers will be able to maintain their mortgage payments.

But it warns: “However, any rise in unemployment, coupled with cost of living pressures and interest rate increases, will put further pressure on some households. 

“We expect this pressure will begin to show in rising mortgage arrears from early 2023, increasing through the year and into 2024. 

“We anticipate the number of households in arrears to reach 98,500 next year, representing around one per cent of outstanding mortgages. By historic standards these increases arrears figures do remain low.”

UK Finance spokesperson James Tatch comments: “The mortgage market is expected to enter a period of relative weakness from next year as house prices, the cost-of-living and interest rate pressures put a brake on new demand.

“The high level of activity during the 2021 Stamp Duty holiday means that a large number of borrowers are due to refinance next year, pushing up the expected value of refinancing in 2023. The pressures being seen on household finances could mean that some customers have fewer options. 

“However, there is wide availability of product transfers – we would encourage customers to speak to a whole of market mortgage adviser to discuss the options best suited to their circumstances.”

He says possessions rose modestly during 2022 as lenders and the courts worked through the backlog of cases that had built up due to the pandemic.

As historic cases make their way through the courts the number of possession cases has risen and UK Finance expects this to continue slowly through the next two years as the backlog is cleared.

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