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May house sales were up 4 per cent on pre-lockdown levels and prices are up by 2.4 per cent, the property portal Zoopla has found.
But there are storm clouds on the horizon as Zoopla and others report a tightening of the mortgage market.
The strongest rebound in sales has been in cities in northern England, including Leeds, Sheffield and Manchester, said Zoopla. But buyer demand surged across England, although ‘moderated slightly during June’.
The strongest house price growth was in Nottingham (up 4.3 per cent) and Manchester (up 3.9 per cent), with prices declining in Oxford (minus 0.6 per cent).
‘We see returning pent-up demand and new buyers entering the market creating upward pressure on prices in the face of a lower supply of homes for sale’, said Zoopla director of research and insight Richard Donnell.
The Zoopla House Price Index is likely show house price growth of around 2 per cent in the next few months but the impact of coronavirus on employment figures and mortgage deals is likely begin to exert downward pressure on prices later in the year, he said.
Meanwhile mortgage lenders have been withdrawing high loan-to-value (LTV) deals, reported the financial information firm Moneyfacts.
Nationwide has pulled its entire range of 90 per cent and 95 per cent LTV deals, it said – disappointing news for first-time buyers and homeowners looking to re-mortgage at a high LTV .
‘First-time buyers who have been saving for a 10 per cent house deposit will have seen the number of mortgage deals available to them fall by 40 overnight, with just 75 deals now available at a 90 per cent LTV’, reported the firm.
‘The number of deals available at a 95 per cent LTV has also dropped by almost half, falling from 33 available yesterday, to just 16 deals on the market today’.
Meanwhile Butterfield Mortgages has said its research had found that lenders had backtracked on some pre-coronavirus offers in principle.
In a survey of more than 1,300 homeowners and prospective buyers, half of buyers said they had found themselves in this position, and close to a third said they had lost their deposit as a result of delays in securing a mortgage.
Four in 10 prospective buyers said they had withdrawn offers because of worries about the uncertainty caused by the coronavirus. And one in eight homeowners had decided against selling, despite having received offers.