Mortgage lending rose at its fastest
pace for nearly eight years in January as investors rushed to beat the
Government’s Stamp Duty hike.
Total lending hit £13.6bn during the month – that’s 38% more than in January 2015 AND the highest monthly increase since July 2008, according to the British Bankers’ Association (BBA).
Lending levels look set to remain strong going forward, with approvals for house purchase rising 27% year-on-year. Meanwhile, loans in the pipeline for remortgaging and buy-to-let soared by 42% and 43% respectively.
Concerns that interest rates may start to rise soon are also ensuring a steady stream of remortgaging business.
Total lending hit £13.6bn during the month – that’s 38% more than in January 2015 AND the highest monthly increase since July 2008, according to the British Bankers’ Association (BBA).
Lending levels look set to remain strong going forward, with approvals for house purchase rising 27% year-on-year. Meanwhile, loans in the pipeline for remortgaging and buy-to-let soared by 42% and 43% respectively.
Concerns that interest rates may start to rise soon are also ensuring a steady stream of remortgaging business.
The fact that mortgage lending is rising at such a fast rate shows
the market is continuing to recover after the financial crisis.
But the rush is bad news for people looking to purchase a property, as it increases competition at a time when the number of homes for sale is already at a record low.
The ongoing mismatch between supply and demand is continuing to push property prices higher, making affordability become increasingly stretched.
Research by the Council of Mortgage Lenders (CML) found that 60% of first-time buyers now take out a mortgage for a term that is longer than the traditional 25 years - roughly DOUBLE the number who did so a decade ago.
But the rush is bad news for people looking to purchase a property, as it increases competition at a time when the number of homes for sale is already at a record low.
The ongoing mismatch between supply and demand is continuing to push property prices higher, making affordability become increasingly stretched.
Research by the Council of Mortgage Lenders (CML) found that 60% of first-time buyers now take out a mortgage for a term that is longer than the traditional 25 years - roughly DOUBLE the number who did so a decade ago.
The group attributed the sharp increase to mounting affordability pressures.
Regional figures released by the CML today showed a fall in first-time buyer numbers in both London and Scotland between October and December 2015, compared with the previous three months.
But those buying their first home are receiving some relief from lower mortgage rates.
The average cost of a two-year fixed rate loan for borrowers with just a 10% deposit has fallen to 2.99%, the first time it has ever dipped below 3%, and significantly lower than the 4.27% it averaged two years ago..
Regional figures released by the CML today showed a fall in first-time buyer numbers in both London and Scotland between October and December 2015, compared with the previous three months.
But those buying their first home are receiving some relief from lower mortgage rates.
The average cost of a two-year fixed rate loan for borrowers with just a 10% deposit has fallen to 2.99%, the first time it has ever dipped below 3%, and significantly lower than the 4.27% it averaged two years ago..
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