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Mortgage offers put Britons one step closer to completion and the purchase of a new home, so are particularly important for the thousands of homebuyers each month. However, the number of offers which actually hit completion has dropped, findings from the Intermediary Mortgage Lenders Association (IMLA) revealed. The study showed only 59 percent of offers resulted in completion in the second ‘quarter’ of 2020 – commonly known as April, May and June.
This is compared to the 85 percent of offers which reached completion in the final quarter of 2019 – before the COVID-19 pandemic hit the UK.
The run up to completion usually means buyers and sellers have exchanged contracts and set a ‘date for completion’ – so called, as it is when the purchase is complete.
On completion day, it is expected all money concerned will officially change hands.
This allows Britons to pick up the keys to their new property and start life in their new home.
Completion can often prove a complicated process, and things do not always go to plan.
A drop in completion, though, could be concerning for those hoping to buy or sell.
However, those looking to buy or sell may be pleased to know there is confidence in how the market will recover.
The number of brokers reported to feel happy with the outlook has increased to 88 percent.
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This is compared to the 85 percent who felt this way in the previous quarter.
Kate Davies, executive director of IMLA commented on the findings concerning mortgage arrangements.
She said: “Thousands of consumers are returning to the housing market after putting their plans on hold, while other buyers are looking to take advantage of the temporary stamp duty holiday.
“This doesn’t mean that the mortgage market is free from further challenges though.
“Lenders already faced a backlog of applications when the housing market reopened in May and this, combined with high levels of new demand from buyers is adding to operational pressures.
“In some cases, applications are being delayed as lenders continue to adapt to the new normal, while supporting existing customers, in particular those who have come or are coming to the end of payment deferral periods.
“With the government’s furlough scheme set to end in October, it remains to be seen how many jobs will have been saved, and what the shape of the economic recovery will be.”
It is evident the property market is still reckoning with the effects of the COVID-19 crisis.
Upon the announcement of lockdown measures throughout the UK in March, the market effectively ground to a halt.
This meant many of those hoping to sell their home, move, or switch mortgage deal are likely to have found the process more complicated than in standard times.
In mid-May, the housing market in England began to reopen, with Scotland, Wales and Northern Ireland also gradually opening up again in the following weeks.
However, demand has since soared, after seemingly being pent up for a number of months.
It is hoped the market will recover as quickly as possible to return the housing situation to the status quo for all those concerned.
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