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TODAY'S OTHER NEWS

Agency tries to reassure landlords in prime markets as economy worsens

One of the leading agents is advising landlords that the high-end housing market is ‘edgier’ than before - but there’s no need to believe capital values will deteriorate significantly.

Knight Frank says mortgage lenders have been feeling the same edginess for a while. 

It says the average rate on a two-year fixed-rate mortgage at 95 per cent Loan To Value rose to 3.9 per cent in August from 2.7 per cent in July. By now - the start of October - deals at such high LTV ratios have become scarce as lenders focus on lower-risk lending.

The agency is advising landlords that buyers in prime markets typically face fewer mortgage constraints and respond more quickly to external events. If lending criteria tighten, prime markets may benefit, it says. 

Additional consolation is provided by the fact that more buyers and sellers are accelerating plans due to the potential for tighter Covid restrictions as well as weaker economic news. 

But it warns that Covid clauses - possible breaks in the rental and purchase chain if the virus triggers more restrictions - are being inserted into contracts more frequently, demonstrating how the urgency is being matched by caution.

Finally, the agency says there’s still momentum in the market. 

The number of offers accepted across the UK in the week ending September 19 was 154 per cent ahead of the five-year average, underlining how activity won’t come to a sudden halt should the market remain open.

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    Prices won't fall long term unless the population falls, especially with the short life span of new build cardboard clad flats.

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    I was walking past the Knight Frank on Islington high street yesterday - looking very empty and miserable. Only 1 person sat amongst the raft of cold-calling telephone desks.

    Business can't be so good.

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