Habito Weekly: The dawn of a new era

We were inspired this week by author Tom Chatfield’s article in the Guardian on how Technology is killing the myth of human centrality, where he described robots as: “Tireless, infinitely patient, endlessly consistent — our creations measure up in ways we can only dream of.” That accurately defines how we believe the role technology — and more specifically Artificial Intelligence — plays in our lives. If we can embrace our own shortcomings as humans and build the tools that fill that gap, we will only become stronger and more efficient.

How does that apply to mortgages? Well, we’ve built the first artificially intelligent digital mortgage adviser to provide free, unbiased advice so our experts can spend more of their time helping customers. It’s just the first step in digitising the entire mortgage application process. But that’s not all that’s happened this week in the world of mortgages, here’s what you need to know.

Pack your bags, we’re all moving to the East of England.

According to the Office of National Statistics (ONS) monthly house pricing index, east is the most affordable place to own a home with an average value of £274,000. Across the country, house prices are £17k higher than they were a year ago, a significant rise despite industry predictions that Brexit would be a silent killer. The good news is that no matter where you purchase a home, house prices rise or fall together. So even if your home is worth less today than it was yesterday, it’s likely your next home will be too.

Re-mortgage, it’s good for you.

We’re big believers in the power of a re-mortgage. Why? You might still be paying your lender’s Standard Variable Rate (SVR) and you could give yourself a pay rise of £4000 a year on average. Despite the obvious wins, a quarter of UK adults wouldn’t change their mortgage for any potential savings and almost 5 million Brits also don’t know what mortgage they’re on. Shocking right?

The good news is the tide is changing. The Council of Mortgage Lenders’ recent monthly data shows re-mortgage lending is up month-on-month — meaning home owners are starting to take control of their personal finances. While overall lending is down, it shouldn’t discourage people from applying for a mortgage. Brexit might be to blame for conservative lending, but it’s also down to mortgage terror. Two thirds of first time buyers living in London are terrified of getting a mortgage and there’s a widespread lack of understanding of the mortgage process. It’s exactly why habito was started, to bring some relief to an otherwise painful experience and ensure you never have to think about your mortgage again.

Generation rent is here to stay.

A lot of controversy this week over the buy-to-let market. Overall rent costs are down, yet tax hikes and stamp duty remain high, making the lucrative buy-to-let market less attractive. Thankfully, some lenders (TMW and Accord at this stage) have started to cut their buy-to-let mortgage rates to attract new landlords and offset some of the hefty costs. We predict we’ll see more lenders following suit as we’re in desperate need of affordable rental housing.

If you need any more encouragement to become a landlord, London is now the second most expensive place to rent in the world (£2136), so know that you’re definitely cashing in compared to sunny Miami (£1420).

The dawn of a new era

We can’t blame you for not immediately thinking of mortgage advice when someone says artificial intelligence. But with the overwhelming number of traditional mortgage brokers, lending options, and comparison sites available today, something had to be done to simplify the way consumers get advice. Using insight from hundreds of advice interviews, we built the world’s first artificially intelligent digital mortgage adviser (DMA). In about 10 minutes, it’ll give you a mortgage configuration based on your life plans and personal finances, which you can then take to one of our experts via live chat or over the phone. And the best part is you can access our DMA from any connected device, 24/7. Read more about how it works here and if you’re a first-time buyer, homemover, or ready to remortgage, sign up and try it for yourself. And let us know in the comments how you got on!