News Review: Lending


No surprise at low lending figures


by David Finlay, intermediary business director, Barclays


gross mortgage lending in november was an estimated £11.1bn, a 5% drop from the £11.6bn in october and the lowest november total since 2000, according to the latest figures from the council of mortgage Lenders. the trade body says the


november figure is 10% lower than the £12.3bn ad- vanced in november 2009. as the lowest november to- tal since 2000, it is the fifth consecutive month where gross mortgage lending has been at its weakest since the equivalent month in 2000. Statistics from the British


Bankers’ association report that gross mortgage lending of £7.8bn in november is a reported 13.5% lower than a year ago. the BBa goes on to say that net mortgage lending amongst high street banks increased by £1.5bn in november, the lowest in- crease since august 1999, compared to £3.4bn in the same month in 2009. the annual growth in the banks’ net mortgage lending was 3.2% in november, substan- tially ahead of the 0.8% for the whole mortgage market in october. gross mortgage lending


by mutuals in november was £2.0 billion, the same as in october, according to the BSa. these figures reflect both


a relatively flat market and the seasonal drop off in ac-


tivity. they are unsurprising when taking into account the continuation of chal- lenging market conditions and i expect december’s fig- ures to continue this some- what disappointing trend.


Interest rates the monetary Policy com- mittee was once again split in december, official min- utes show. rate rebel andrew Sen-


tance continued in his stance regarding an interest rate rise, voting once again for a 0.25% increase, while adam Posen again voted to increase quantitative eas- ing by £50bn. But both men were overruled as the seven other mPc members voted to keep interest rates at 0.5% and quantitative easing at £200bn. one of the hottest topics


of early 2011 is when and how much the Bank of eng- land Base rate will rise in the year ahead. it has been widely predicted that it will remain at 0.50% for the ma- jority of 2011 but this is not set in stone. inevitably this is an area that will continue to generate increased interest amongst intermediaries and consumers alike over the coming months.


Affordability and availability another on-going hot topic is the affordability and avail- ability of competitive mort- gage deals. With criteria and LtV levels also at the forefront of intermediaries minds it was positive news for the market in general to see research from e.surv suggest that the average


8 mortgage introducer FEBRUARY 2011


LtV offered by mortgage lenders rose to 58.9% in de- cember, the highest level for two years. the rise in LtVs, of just over 1% in a month, was said to be driven by homes worth over £500,000 with wealthy borrowers of- fered an additional 2.8% of the value of their property in december compared to november. in other encouraging


news, mortgage affordabil- ity is said to be at its most favorable for 12 years for those looking to take their first steps onto the property ladder says the latest annual Halifax First-time Buyer review. the review outlines that


the proportion of disposable earnings devoted to mort- gage payments by a potential new first-time buyer stood at 27% in September 2010; the lowest since december 1998 and almost half of the peak level of 50% in Sep- tember 2007.this significant improvement in affordabil- ity over the past three years has been mainly driven by a combination of lower house prices and declining mort- gage rates. equifax research shows


that availability is also im- proving as it registered a near 10% fall in the number of applicants who reported having difficulty getting ac- cess to competitive mort- gage deals in 2010 when compared to 2009. of course any improve-


ments in the figures above has to be a good thing but it is obvious that the industry as a whole needs to continue working hard to give bor-


rowers and intermediaries access to competitive and af- fordable mortgage deals.


Remortgage the remortgage market has certainly seen an increase in profile and performance in the last quarter of 2010 and this is expected to continue into 2011. indeed, data released from the Bank of england Lend- ing to individuals’ report suggests that remortgage activity increased in no- vember by £400m. remort- gaging was valued at £4.4bn in november compared to £4bn in october. the data showed that the number of approvals for remortgages stood at 34,262 compared to 30,429 in october, well above the six-month average of 28,210. While retirement plan-


ning and investment and savings were said to be the top triggers for consum- ers seeking independent financial advice last year, december saw remortgage advice became the number one driver for consumers seeking whole of market mortgage advice. remort- gage advice in decem- ber made up 35% of the total searches on unbiased. co.uk’s find a mortgage adviser site with first time buying advice the second most searched for term at 32%. these are both pieces


of great news for intermedi- aries. the remortgage mar- ket has certainly regained some much needed mo- mentum and let’s hope this continues.


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56