In the face of fears that interest rates will soon skyrocket causing mortgage rates to launch right along aside of them, the amount of people that choose to remortgage their homes over last month soared to the highest it has been an a 26 month period.  New figures from the Bank of England reveal that a little under 36,000 people choose to remortgage their homes during the month which is the largest amount of people to do so since December of 2008 making it a busy month for bankers even though the amount of new mortgages for the period only peaked slightly.

The jump in remortgages is thought to have been driven by reports from the Bank of England that the base rate is going to increase sharply as a response to the rate of inflation which continues to increase.  This prediction led many people who had variable mortgages to quickly head into lender’s offices in search of fixed mortgages to protect themselves from higher monthly payments.  The base rates is expected to steadily increase over the next few months leading many people into paying much more on their monthly loans which will put a strain on already strained household budgets.

Even though there was a rush of people over the month of February searching to secure their monthly payments and even some who were concerned about their commercial mortgage rates, remortgage amounts are still much lower than what was seen on a typical basis before the recession when approximately 100,000 remortgages were approved every month.  This is due to the attributed to the fact that many people do not have the credit to be eligible for a remortgage with the stricter lending terms preventing them from seeking out the remortgage that they also may be in need of to protect their investments.

February also saw a slight peak in new mortgages that were approved making it the most productive month since November of 2010, but when compared to the average amount of a stable housing market mortgage approvals are still down by about 40% of their previous standard.  Net mortgage lending was also shown to decline down to £1.2bn over the course of last month from its previous amount of £1.8bn in January although when compared over a six month period the rate is still considered to have increased.

Barclay’s Bank is looking to get rid of some of its commercial mortgage assets with an announcement this week that they will sell £360 million worth of their commercial development assets that will also include many commercial mortgage loans as well.  In all, a total of thirty commercial assets will be sold off.  Those that are sold will still be available to owners on the same terms as they are secured by the REIT (real estate investment trust) CreXus investment Corp.  CreXus is hoping that the acquisition of the development assets will help to widen their approach into the property market.

Chief executive and president for CreXus, Kevin Riordan, stated that the move will help show that CreXus is ready to jump into the property market and is able to take advantage of the many opportunities that there are for growth in terms of what is out there in the commercial mortgage market and what is out there when it comes to commercial real estate finance.  The fact that there was a buyer for the large amount of commercial properties signifies that there is hope for the real estate market after all even though many the market has been stagnant for quite some time.

There are many different properties included in the sale including some buy to let mortgage rates, hotels, retail spaces, offices, and other types of commercial properties which Riordan stated should help the company to add more diversification to its current portfolio along with some quality properties.  CreXus is not the only company to look at purchasing commercial properties in an effort to charging up their portfolio as O Twelve Estates also decided to sell off the Solar House site to make room for more promising portfolio additions showing that development within the property market may be looking up.

Last week the amount of mortgage applications filled at banks improved by 15% which is a heartening figure after months of worry over the credit crisis has kept both businesses from seeking commercial mortgage approval as well as residential applications from getting filed.  One explanation for the possible increase in applicants is the fact that the labour market is looking up briefly, even if analysts predict that it will soon take a dive again.  While unemployment looms in the future, during this brief respite people seem interested in mortgages again if the numbers are to be trusted.

Outside of applications for new mortgages, the about of people applying for refinancing loans perhaps in the attempt to get locked into fixed mortgages before the climate changes again also increased by a large 17% when compared to on a week to week basis and is the highest rate of those looking for new loan terms since the second week of January.  Still, despite the positive glow of these figures that help make the housing market look a little bit more sable when unadjusted the purchase index is still down by about 14% when compared to a year on year average for the same week.

Still, considering that the amount of applications period for mortgage rate approvals sits at their highest since May of last year; it’s still not too bad of a feat for a market that is constantly referred to as dragging.  Michael Fratantoni from the Mortgage Bankers Association stated that the job market and the mortgage market usually accurately reflect each other since the job market needs to be improving if there is to be any hope for the housing market to recover as well.  He added that lower interest rates have helped many who have been waiting for the chance to get a new refinanced mortgage at an acceptable rate.

New figures from the Nationwide building society suggest that the housing market decline in prices may finally be coming to a halt, or at least proceeding to fall at a slower rate, as the prices gently rose by .3% over the course of February.  This is good news for those who are seeking a commercial mortgage or those who are seeking a regular mortgage since both property markets have been hit hard over the last few years.  Although Nationwide is still defining the market barely holding its head above the water, the good news is that with prices finally starting to flatten they have at least stopped dropping.

Chief economist for Nationwide Robert Gardner stated that the fact that the housing prices have gently shown signs of improvement should not be too much of a surprise given the fact that housing markets tend to align with the larger economic prospects that are on the horizon.  Gardner added that with low interest rates that are making buy to let mortgage rates look a bit more desirable and the demand for homes starting to level off it is not a surprise that the housing market is showing signs of recovery finally, even if they are small.

However, the picture is not as rosy according to many commentators and economists who believe that housing prices are going to fall even more this year down by as much as ten percent combated by a sharp rise in mortgage rates. Gardner debated this point of view however by stating that while there will be a low level of final housing sales and the restricted mortgage approvals the price of houses will actually start to rise due to the restricted amount of buyers allowing the market to be a bit more competitive.

He explained this theory further by stating that lenders rationing their mortgage funding is beneficial in the long run.  He calculated that on an average salary if a person saved about 15% of their take home income then it would be eight years before they could make the required deposit on a home which would mean that the amount of buyers would be low.  However, in order for prices to stay down sellers will also have to remain low with many holding on until the prices look better.

Commercial development has continued its steady decline in recent months, with reports indicating that it has fallen at the fastest rate this past August since June 2009. The data, provided by Savills, reflects not only major decreases in the commercial zones but also public and private sector development throughout the country, showing the first decrease in private developments since July of 2009. As a whole roughly 28.3% of all commercial property developers showed a decrease in activity compared to a meager 15% showing a rise, leaving the national average for the month at -13.3% (well below July’s +0.6% and the 0.7% year-to-date average).

This fall is seen to be contributed to a number of reasons ranging from decreased consumer confidence on a domestic level to even the increased restrictions on many overseas mortgages being granted by local lending institutions to foreign investors looking to establish holds in the UK market. Fears that the property market is heading for a double-dip and will soon face large drops in overall value in the coming months towards 2011 are only working to add to the current woes and many feel this will in turn become a self-fulfilling prophecy as consumer wariness gros stronger day by day.

On the positive side of things, however, the fact that there is still a 15% recorded increase in some areas is a strong indicator that no matter how bad the situation may seem it is not a universal occurrence. On the contrary, many areas have proven to be virtually immune to the effects of the property market downturn, with London in particular still remaining a primary point of interest for both domestic and international investors. Whether other areas will see the same growth towards winter when the property market is traditionally the lowest, however, is still yet to be determined.

Despite the fact that the recent problems in European markets may well have impaired the prospects of recovery globally, a recent report from CB Richard Ellis has shown that there has been an improvement in activity in the Dublin property office market during recent months.

Take-up rates in Dublin over the past three months are liable to be higher than in the first quarter of the year, according to the report, with a number of landmark deals set to be signed imminently.

Pretty well all transactions being completed in the Dublin office market currently are lettings deals, although one high-profile office sale has gone through in recent weeks-that of a Georgian office which sold for around two-million Euros.

Added to decent letting activity, there are also several significant necessities for office accommodation in Dublin, which the report claims is very encouraging.

Dublin’s prime rents are currently keeping steady, at around 376 Euros per square metre, or 35 Euros per square foot. However, downward pressures are still affecting secondary accommodation, especially around the M50 where there exists a lot of vacant accommodation.

Although there has been a fall in eth number of new schemes coming on stream of late, the current overhang of space will not erode quickly – and not until more net absorption is achieved, according to the report.

The report states that the rising number of foreign firms – especially IT and pharmaceutical companies – that have chosen to set their European headquarters in Ireland has been particularly encouraging. The report states that many have undoubtedly been attracted by the 12.5% rate of corporation tax, as well as the fact that prime rents have fallen by as much as 44% from peak rates. It says also that the marked decline in wage rates over the last year and a half has also helped, along with the ready labour availability.

The report concludes that, although there is an overall clear improvement in the demand for property investment in Ireland, there is still a lack prime properties coming up for sale. Also, transaction values, despite being up by a significant margin year-on-year, are still weak, the report concludes.

Speaking on the back of the latest market figures, property market experts have concluded that fast-rising commercial property values in the UK have caused European property investors to alter their sights to continental Europe as they look for stronger returns there.

The chief investment officer of CB Richard Ellis Investors. Ian Gleeson commenting on the phenomenon to the London Business School’s Conference, said: “We are seeing much more interesting opportunities on the continent now. Pricing in the UK is less compelling than it was a year ago, although it does still offer value. Commercial property prices in the UK have climbed 13% since July last year during which time the property market rebounded from a two-year downturn. The tenant market, however, is still weak as average rental values continue to fall.

The managing director with Aviva Investors, Ben Stirling, commented that property returns on continental Europe generally returns at an aggregate 7.5% in the period from 2010 to 2015. It’s forecast for the UK for the same period, by comparison, is around 8.5%. Stirling further commented: “On the face of it, the UK does appear to be an attractive prospect purely from a returns perspective, although a lot of the value in the UK is being delivered in the course of this year, and the anticipated returns profile is less attractive looking forward.”

The two firms stated that they certainly recognise value in both the German and French commercial property markets, with Aviva also interested in western European regions like the Benelux and Nordic areas. areas.Stirling further commented on his worries regarding debt problems in such fringe markets as Ireland and Spain. By contrast, Land Securities chief executive, Francis Salway, is convinced that the London office property market and sector prospects appear to be strong due to the fact that developers have not overbuilt in the way they did in the early period of the millennium and good mortgage offerings exist in order to help stimulate the commercial sector still, particularly for individuals with good finances and credit history looking to open up their own location via a self-cert mortgage.

Salway further commented that London, as a city, is very much global, and many businesses are serving Singapore, New York and Hong Kong rather than Newcastle. “London firms continue to plan their expansion in line with global growth,” he added. According also to a new report, the French commercial investment market doubled its turnover in the first quarter of this year, and totalled almost 1.8 billion Euros as compared to 0.9 million for the same period in 2009.

The results of a new survey have indicated that there are signs of improvement in certain sectors of London’s commercial property market, the result of which has pushed office rental expectations upwards at the fastest rate for more than two years. In fact, where London offices are concerned, expectations rose markedly above zero for the first time since 2007’s final quarter. Available space also  declined for the second quarter in a row, according to the figures from the latest UK Commercial Property Survey conducted by the RICS. The figures represent the first anticipated rental rise by RICS surveyors for two years. The figures also showed a positive net balance of 57%, which compares extremely favourably to the previous zero level, represented to largest upward climb on record. This also contrasts sharply with the remainder of the UK which shows available space increasing across all sectors with rental space still in negative territory.

Renting activity continued to increase for commercial properties for the second quarter in a row, despite the fact that domestic and overseas investment demand has toned down a little outside of the London Metropolitan zone despite many favourable mortgage rates. The retails sector still lags behind-especially in London with rising available space still pushing rental expectations, according to the report. In general, the market confidence for the outlook for lettings continued its upward trend, although sentiments were a little deflated as compared to the fourth quarter of last year.

A number of surveyors have raised concerns regarding the possible impact of potential public sector employment cuts following next month’s election on regional lettings activity. There is also concern regarding the changing balance between landlords and tenants. According to Oliver Gilmartin, senior economist with the Royal Institution of Chartered Surveyors, the latest figures suggest that rental expectations for London offices have lifted greatly as a result of the ’still modest recovery in lettings demand’.

‘There are signs that a weaker pound as well as a gradual re-balancing of the UK national economy towards much greater export activity has started to bleed through to industrial lettings activity-particularly in London and the South,’ Mr Gilmartin explained. He went on to say that lettings activity is still rising cautiously across the country, although surveyors remain cautious, concerned that regional office markets could be hit as a result of potential public sector cutbacks as a result of the election could weigh on demand.

Reports from the Royal Institute of Chartered Surveyors (RCIS) indicate that over half of all lending agencies (57%, in fact) state that the feel confident that rental prices for commercial lots in downtown London will increase in the coming months. This is the largest increase in confidence on quarterly projections for quite some time, with the strongest interest in development seen since the end of 2007.

The driving factor many people feel behind this growth of lender confidence lies in the current market situation – with a large number of good mortgage offerings having been made available by lending institutions to support the commercial real estate sector (as well as the various government support designed to help out over the past year) the value of commercial property mortgages and investment has increased significantly. This has drawn in more local investors looking to secure holdings and overseas investors looking to secure prime rate overseas mortgages alike.

Perhaps the biggest indicator of the recovering commercial sector is Canary Wharf, with more companies finally investing back in the area after a near collapse that was seen just a few months prior. Now the Canary Wharf group is reporting positive growth on their locations, with further development to be expected as the year progresses as well.

The primary difficulty facing most commercial property up till now has been the delayed effects the recession had upon most holdings. As most commercial properties are dependent upon long-term business finances a lull in profits for an extended period of time may not have an impact immediately but will have far-reaching consequences in the future. This is exactly what happened in many areas throughout business centers such as those in London where just as the economy was beginning to recover the commercial property sector was beginning its full decline – something that the recent trends look to counter, much to the joy of developers and legislators alike.

In many instances

standard variable rate (SVR ) is lower than the rate that had been paid during the initial deal. That’s the reason for many borrowers whose current deal is coming to an end to choose between  taking out a new deal or moving to their lender’s SVR.

Sometimes the mortgages arrangement fee cannot be justified due to the risk of defaulting so it must be due to the risk of interest rates rising.

Asking yourself if you should  insure against mortgage hike? There is only one answer:

Unfortunately there isn’t  any insurance that will protect against a rate increase.

Choosing to move to your lender’s SVR for the time being you should consider setting up a savings account in which the difference between your old and new lower monthly payment could be saved.

This money can be utilised in a future event of a of a sudden rate increase, giving you a buffer,  while you are looking for a new deal.

The only way to ensure that your monthly payment remains the same, regardless of any rate increase, is to move from your current deal onto a fixed-rate deal. But, even financial experts can’t agree on the way ahead.

Borrowers are facing unprecedented uncertainty over the future path of interest rates, which means a tough choice between low-rate tracker mortgages and the security of more costly fixed-rate deals.

Accordinding with L&C the tracker would be the best choice in terms of total repayments over the five years if interest rates rose at a slow, steady pace, but the fix would be better if rates rose sharply.

 Homeowners with low SVRs of 2.5% should also stay put. The  research shows that on any SVR at 4% or higher you could end up paying more than on a five-year fixed rate by the end of the term (in this „steady” scenario) and should consider remortgaging.