Here we all are again, back to school, maybe even back to the office more regularly as we try to understand what the new normal way of working will involve.

I really hope you have all managed to take some sort of break, whether that be abroad or here in dear ol’ Blighty like me, sitting on a bottom-breaking, pebbly beach down south, all wrapped up, getting a ‘cloud tan’ but determined to get at least one full day on it!

It is notoriously difficult for brokers to switch off at the best of times, especially with the lure of the smartphone and the ever-present addiction to social media, but making some time for yourself is even more essential after the past 18 months. So, if you haven’t yet had a chance, please do.

It looks like there will not be much let-up in activity for the remainder of the year, with demand for property still high, the final part of the stamp duty holiday still to play out and mortgage rates incredibly low. It is only the low levels of housing stock that stem the tide a little, while we are expecting another bumper quarter in terms of remortgages, and rate roll-off activity.

Whichever way you look at it, the property market did not need the stamp duty holiday

The latest stats from the Bank of England showed that mortgage approvals for house purchases decreased in July to 75,200. This is the lowest since July 2020 but remains above pre-February 2020 levels.

What was interesting was that individuals repaid £1.4bn of mortgage debt, on net, in July. Net repayments are fairly rare, with only one other repayment (in April 2020) in the past decade.

The net repayment in July is a reflection of the stupendously low rates on offer, which are seeing people remortgage in droves and which enable them to pay off more of their mortgage than they may otherwise have been able to.

Holiday effect

Mortgage approvals were always going to fall after the stamp duty holiday as people switched their focus to the genuine holidays. But demand is still very much there and you would expect supply to increase again as people return from their break and decide now is a good time to sell or make their next move.

This stable demand combined with low levels of stock must be behind the continued property price growth that many thought would slow, but which, according to Nationwide, reached an annual rate of 11% in August.

We expect another bumper quarter with remortgages

Whichever way you look at it, the property market did not need the stamp duty holiday. House prices are around 13% higher than when the pandemic began, Nationwide chief economist Robert Gardner says.

The money markets have enjoyed a brief summer sojourn and are still lazing around the pool, with three-month Libor drifting to 0.07% while three-month Sonia is sipping raki and reading Maynard Keynes at 0.05%.

Swap rates, meanwhile, are still out on the lilo, drifting nowhere fast.

Since the last column:

2-year money is up 0.11% at 0.49%

3-year money is up 0.08% at 0.60%

5-year money is down 0.02% at 0.71%

10-year money is down 0.14% at 0.86%

As you all know, mortgage rates remain at extraordinary levels with sub-1% borrowing available on both two-year and five-year fixes.

Santander is the latest lender to reduce rates to below 1% with a suite of competitive offerings, and from what I can see there are now more than 50 products under the 1% mark.

It is really good to see Aldermore back at 95% LTV as a specialist lender

These days when I quote rates to clients, I sometimes find myself double-checking that I have not made a mistake — they are just so low.

We’ve seen 90% loan-to-value mortgages continue to ease over the summer and dip to around 2%. At higher LTVs it is also really good to see Aldermore back at 95% as a specialist lender.

Self-employed borrowers

Lenders are still getting to grips with the self-employed and underwriting their income through the pandemic, hence we see more criteria changes.

Halifax, for example, has tweaked its stance and now, for any self-employed income where the amount keyed for the ‘previous year’ is up to £50,000, the income used in affordability will be the lower of the past two years’ figures. Where the income in the ‘previous year’ is above £50,000, the amount used in affordability will remain as the lower of the latest year or the average of the past two years.

The average time taken from offer to exchange is between 13 and 16 weeks

It is good to see that NatWest is allowing applications from those self-employed customers who have historically claimed SEISS grants and will no longer ask them to complete the mandatory self-employed application submission sheet; also, that HSBC will no longer ask self-employed applicants to provide bank statements from the first three months of 2020.

However, there is still some way to go for self-employed and contractor applicants before they are afforded the same choice they had prior to Covid.

Meanwhile, service remains an ever-important part of the mortgage process, and Propertymark’s latest report suggests that the average time taken from offer to exchange is between 13 and 16 weeks.

Do you remember several years ago the prediction was that, by now, we would have everything within a matter of hours, not lengthening transaction times?

Anyway, with this in mind it’s good to see Virgin Money back with its 10-day application-to-offer commitment, which if packaged correctly should not be an issue.

Leading by example

Finally, a thank you to everyone who completed the Association of Mortgage Intermediaries’ viewpoint questionnaire around diversity and inclusivity. It seems there was a fantastic response on this important topic, and I am sure this will help to not just form a blueprint for where we are now but build on and deliver some real change in the future.

There are now more than 50 products under the 1% mark

Given that the Financial Conduct Authority has published a letter to financial firms within which it wrote, “increasing the diversity of your workforce and fostering an inclusive environment, where every member of staff is valued for their contributions, is a key element of a healthy culture”, this shows what’s on its mind.

Our fabulous mortgage industry really can lead from the front and be a shining light for others to follow.

Andrew Montlake is director of Coreco