KBRA Releases Research – UK Mortgage and Housing Market Trends

LONDON--(BUSINESS WIRE)--KBRA UK (KBRA) releases a report that explores the financing market for home purchases across the UK, as well as current challenges and trends in the region’s housing market. Financing of the UK mortgage market is a competitive marketplace with many participants. It has become an area of focus in recent years as interest rates rise and the cost of financing home purchases increases.

Key Takeaways

• The amount of UK residential mortgage-backed securities (RMBS) held by investors is shrinking as issuers and investors temper their focus, while covered bond and retained RMBS volumes has increased. However, the last several weeks have seen a number of new RMBS transactions come to market.
• Loan performance is starting to show signs of deterioration as delinquencies and repossessions increase from historically low levels in the prime, buy-to-let (BTL), and nonconforming mortgage markets.
• Affordability is becoming a challenge with high interest rates, as well as borrower concerns regarding their overall financial health.
• Mortgage lending has slowed as affordability has been strained and borrowers have expanded the duration of their initial interest rate fixed term.
• House prices look vulnerable to further declines as they correct from large post-pandemic increases. However, pricing will likely remain elevated due to supply constraints, and they continue to impact affordability for owner-occupied and BTL properties.

Click here to view the report.

Related Publications

• UK Buy-to-Let: A Brewing Remortgage Storm?
• Equity Release Mortgages: Supportive Environment for UK Expansion … and Beyond?
• UK Building Societies: Facing Increasingly Difficult Times
• UK Consumer Crunch: Challenging Times Ahead

About KBRA

KBRA is a full-service credit rating agency registered in the U.S., the EU and the UK, and is designated to provide structured finance ratings in Canada. KBRA’s ratings can be used by investors for regulatory capital purposes in multiple jurisdictions.