Rayner spells out plans for better housing and rental sector

NatWest CEO looks for 2.5% to 3.5% base rate ‘sweet spot’

NatWest CEO Paul Thwaite has identified a base rate of 2.5% to 3.5% as an ideal “sweet spot” for the bank, balancing loan demand and profitability while minimising non-performing loans. Speaking at a Bank of America Securities conference, he noted a recent uptick in mortgage business following the Bank of England’s 0.25% rate cut to 5%. Thwaite emphasised that the wider policy environment, especially regarding planning and first-time buyer support, is expected to enhance the mortgage market amid ongoing changes in the political landscape.

The Mortgage Works and Halifax announce rate reductions

The Mortgage Works and Halifax have announced rate reductions effective 26 September. The Mortgage Works will cut rates by up to 0.35 percentage points on selected buy-to-let (BTL) products, starting at 3.49%. Notable reductions include the two-year fixed rate (purchase/remortgage) at 3.99% with a £3,995 fee. Meanwhile, Halifax has reduced rates on homemover and first-time buyer products by up to 0.30%, covering large loans, new builds, and affordable housing options.

Nationwide boosts FTB lending up to six times income

Nationwide has announced an enhancement to its Helping Hand mortgage, allowing first-time buyers (FTBs) to borrow up to six times their income for five- or ten-year fixed rates at 95% loan-to-value (LTV). This represents a 33% increase from its standard 4.5 times income limit. Additionally, Nationwide has reduced rates for FTBs by up to 0.31%, becoming the first major lender to offer a sub-5% rate for those with a 5% deposit. The maximum loan size for various LTV bands has also increased, facilitating greater access to homeownership.

FCA to detail ‘name and shame’ plans in autumn

The Financial Conduct Authority (FCA) plans to provide more details this autumn on its controversial “name and shame” strategy for companies under investigation. This initiative aims to enhance transparency, with the FCA believing that disclosing names serves the public interest. While consumer advocates support this move, many regulated firms oppose it, citing concerns over potential negative impacts on their valuations and market stability. The FCA has received over 130 responses to its consultation and intends to engage further with stakeholders to refine the proposal.

BoE’s Bailey expects rates to come down ‘gradually’

Bank of England governor Andrew Bailey forecasts that interest rates will gradually decrease but does not anticipate a return to ultra-low rates. Following the Monetary Policy Committee’s decision to maintain the bank rate at 5% after a recent cut, Bailey noted that inflation, currently at 2.2%, remains just above the target. He emphasised that the path for interest rates is downward, while asserting that significant economic shocks would be needed to return to previous lows. Markets predict further cuts at upcoming committee meetings.

NatWest makes rate cuts of up to 0.60%

NatWest has announced rate cuts of up to 0.60% across its new business product range, particularly benefiting buy-to-let (BTL) mortgages. The 75% loan-to-value (LTV) two-year fixed rate purchase product has been reduced from 4.76% to 4.16%, while the remortgage rate for the same LTV decreased by 0.47%. Additionally, the lender is enhancing broker support services with a single contact number and an expanded LiveTalk service to streamline communication and improve the homebuying process.

Rented homes will have to meet EPC targets by 2030: Govt

The UK government has announced that all rented homes must achieve an energy performance certificate (EPC) rating of C by 2030. This initiative aims to ensure warmer, more affordable homes and combat issues like damp and mould. Currently, private rentals can meet a minimum EPC rating of E, while social homes lack any standard. The government will consult on these proposals and introduce a Warm Homes: Local Grant to assist low-income households with energy upgrades, potentially lifting over one million families out of fuel poverty.

Barclays latest to offer sub 3.75% deals

Barclays has joined the trend of lenders offering sub-3.75% fixed mortgage rates, launching a new 3.71% five-year fixed deal for residential purchases effective from 25 September. The lender is reducing rates on several existing products by up to 0.34% and introducing new offerings aimed at first-time buyers and second movers, including a 4.75% two-year fixed mortgage with an £1,999 fee. Market experts expect ongoing subtle reductions in mortgage rates as lenders compete for business, making borrowing conditions more favourable.

TSB did not breach ‘mortgage prisoner’ contracts, High Court rules

The High Court ruled that TSB did not breach home loan contracts with hundreds of ‘mortgage prisoners.’ Judge Nicholas Thompsell determined that TSB’s Whistletree subsidiary, which acquired £3.3bn of Northern Rock mortgages, acted within its contractual rights regarding interest rates. Around 400 claimants allege they overpaid due to higher variable rates, costing them an average of £30,000 each. Although the ruling was a setback for the claimants, the UK Mortgage Prisoners Action Group plans to continue advocating for consumer protections in the mortgage sector.