Signs of the market slowing - Comment on the HMRC property transactions for October from Richard Pike at Phoebus Software

22 November 2022

Richard Pike, Phoebus Software’s chief sales and marketing officer, says “The non-seasonally adjusted figures for residential transactions although higher than in October ’21 is starting to show the first signs of the market slowing down. Not that this is unexpected. With all the pressures from inflation and the consistent increases to Bank of England the base rate. The fact that mortgage rates have actually come down recently is something that appears to have escaped the notice of the mainstream press. This means that while the perception is that ‘interest rates’ are rising confidence is likely to be affected negatively, which may slow the market further.

“With inflation eroding any increase in real wages the question for lenders will be one of long-term affordability and the likelihood of an increase in the number of mortgages going into default. Using all the tools at their disposal will be key. Having the right technology in place at this point will ensure that lender personnel are there at the front end to aid vulnerable borrowers. This is especially important now that the industry is being held accountable by the FCA’s Consumer Duty principles.”