Whole of Market Mortgage Advice

Parents across the UK are increasingly worried about their children’s health and wellbeing, according to research from LV=. Their latest ‘Reaching Resilience’ report suggests two-thirds of parents (67%) fear their child being diagnosed with a serious illness. Concerns about children’s mental health are also rising, now affecting 68% of parents, up slightly from last year. The worries aren’t just health-related, with 62% of working parents fearing the financial consequences if illness or injury prevented them from working. Nearly a third (31%) said they would struggle financially if being diagnosed with a critical illness means losing income. LV=’s report highlights that the average worker in the UK supports three people financially, including children and elderly relatives. Parents are also more likely to worry about the impact of illness or injury on their family’s finances compared to workers without children. Income protection policies provide much-needed reassurance by offering financial support if illness affects parents or their children. Some policies include family-focused cover, giving parents the financial breathing space to focus on caring for a seriously ill child without worrying about bills. As with all insurance policies, conditions and exclusions will apply

A new Learning and Work Institute report suggests just 1% of UK workers looking to return to work after poor health manage to find a job within six months, even though 20% of those considered to be ‘economically inactive’ want to work. According to the report, a combination of inadequate support to return to work, skewed financial incentives and inflexible employers have created a benefits trap. It is calling for changes to financial incentives for ill and disabled people to work and argues against further cuts to benefits. Benefit bill concerns The findings come ahead of government plans to overhaul working-age health and disability benefit which are projected to cost £100bn a year by the end of the decade. Steven Evans, Chief Executive of the Learning and Work Institute, commented in the report, ‘3.5 million people receive incapacity benefits because they are too ill to work, up 37% since the pandemic. Many want to work, but too few are offered help to find work and not enough workplaces offer suitable employment opportunities.” The report suggests spending £450m a year on improving employment support could save £4bn a year in the longer term, in the form of lower benefit payments and higher tax receipts. The Learning and Work Institute proposes several improvements to the benefits system that it believes would help bring 500,000 more people back into work over a ten-year period. The proposals include improving and decoupling financial support, introducing a new ‘Benefits Passport’, inviting more people to regular ‘work support conversations’, expanded employment support and working with employers to offer better opportunities and to support job retention. The importance of income protection The findings highlight how income protection policies can be a valuable safety net for anyone who suffers illness or injury and is unable to return to work quickly. Government support is often insufficient or inflexible, meaning without insurance in place people often struggle financially and lack the tailored support they need to resume employment. Income protection is invaluable as it pays out a regular ‘income’ which can give added financial security for you and your family, as well as giving you time and space to recover fully and be able to return to work. Mortgage payment protection insurance (MPPI) It’s also possible to take out a form of income protection which covers your mortgage repayments if you can’t work due to involuntary redundancy, illness or injury. MPPI can fully cover your monthly repayments as long as they don’t exceed 65% of your gross monthly salary. Most insurers will support you for up to 12 months or until you return to work – whichever is sooner. As with all insurance policies, conditions and exclusions will apply

The UK mortgage market bounced back strongly at the end of 2024, driven by first-time buyers and home movers, according to UK Finance. First-time buyer mortgages rose 16.4% to 334,000 last year, while home movers increased by 14.7% to 288,000. Total home purchases reached 622,000, up 15.6% overall. Lower mortgage rates boosted demand in 2024, especially in the fourth quarter, as buyers rushed to beat the changes to Stamp Duty rules this April. However, remortgage deals fell by 9% to 1.6 million, mainly due to fewer fixed-rate deals expiring. This is likely to change in 2025, with 1.8 million fixed-rate mortgages due to expire. Stricter lending rules introduced from 2014 have made it tougher to secure high loan-to-income mortgages (over 4.5 times salary). As a result, first-time buyers in London now need deposits worth more than 2.5 times their annual income, compared to 1.9 times before 2014. Eric Leenders from UK Finance said, “The strong end to 2024 highlights the resilience of UK households. But affordability remains a challenge, particularly in London. The upcoming regulatory review, expected this spring, could ease lending restrictions and help more people onto and up the housing ladder.” Your home may be repossessed if you do not keep up repayments on your mortgage

The housing market continues to show signs of recovery as house price growth remains relatively stable*. In February, the average UK house price rose by 0.4% - the sixth consecutive monthly increase. Meanwhile, annual growth was at 3.9% - only marginally lower than the pace of growth in January (4.1%). This steady increase is likely due to a spike in market activity - in the second half of 2024, housing transactions were up 14% in comparison to the previous year. However, we are heading into more challenging times due to the recent Stamp Duty changes. According to Robert Gardner, Chief Economist at Nationwide, “This will likely lead to a jump in transactions in March, and a corresponding period of weakness in the following months, as occurred in the wake of previous stamp duty changes.” *Nationwide, 2025

Fixer-uppers are the most popular type of home among buyers this year*. Analysis has found that nearly half (46%) of fixer-upper homes on the market are under offer or have sold subject to contract. Meanwhile, 37% of period properties on the market have found a buyer and modern homes are the least popular, with only 27% under offer. It is estimated that the average fixer-upper property is discounted by 12%2, indicating that the nation is opting for the most affordable option. However, supply is limited, as fixer-uppers account for only 5% of all homes listed. There is better availability for modern homes (10%) and period properties (28%). Hoping to make your property dreams come true in 2025? Get in touch. Your home may be repossessed if you do not keep up repayments on your mortgage * Yopa, 2025 2 Rightmove, 2024