New lending criteria following the introduction of the Mortgage Market Review in April means that 40% of home owner believe that getting a mortgage is now harder than it was three months ago, the latest Zoopla Housing Market Sentiment Survey has found.
Londoners are no longer the most confident about further house price growth but overall some 92% of home owners surveyed expect UK property prices to increase over the next six months, slightly down from a four year high of 95% earlier this year.
It is the first time in a long time that London home owners are not the most confident across the country about house price rises in their area. The South East, the South West, the East of England and the West Midlands have all overtaken the capital in terms of home owner confidence.
With London prices having moved up so far and fast, the proportion of homeowners in the capital who expect prices to rise over the next six months has fallen from 98% to 92% over the last three months.
And amongst the 7,810 homeowners surveyed by Zoopla, the average prediction for house price growth over the remainder of the year currently stands at 7.6%.
The Mortgage Market Review (MMR) and associated new lending rules have both slowed down the mortgage application process and made securing finance more difficult. Despite that, 79% of UK home owners plan to spend at least the same or more on home improvements over the next year compared to last year.
‘After months of consistent growth in the capital’s property market we are now seeing a slight increase in caution among London’s home owners. More broadly, securing a mortgage appears to be getting harder now that MMR has caused lenders to be more rigorous with their lending criteria and approval process,’ said Lawrence Hall of Zoopla.
A breakdown of the figures show that the most confident about property price rises are home owners in the South West and South East of England with 95% in both regions expecting them to rise. In the East of England and the West Midlands it is 93% and in Wales and London 92%.
In Yorkshire and the Humber some 91% think prices will keep rising by December and in the North West, the East Midlands and Scotland it is 90%. In Northern Ireland it is 87%.
