MORTGAGES
Lending loosens up
Brian Murphy of Mortgage Advice Bureau says some choice is finally returning to the mortgage market.
A
lthough it is far too early to talk about a resurgent mortgage market, the general mortgage landscape is nowhere near as desolate a place as it was two years or
even 12 months ago. Products available to intermediaries are up almost 50 per cent on numbers this time last year and competition amongst lenders has returned, if rather muted. There is a raft of competitive products on the market and some fantastic rates for borrowers, particularly for those who are able to put down sizeable deposits of 25 per cent or more.
However, scratch beneath the surface a
little and there are still plenty of worrying signs that the mortgage market still has a long way to travel along the road to recovery. The Council of Mortgage Lenders most recent Gross Mortgage Lending figures showed that lending was around £11bn in December, down six per cent on the previous month, 18 per cent down on the same month in 2009, and the lowest total for any month since 2000. Money market rates have moved higher recently in anticipation of base rate rises and some lenders have responded by reflecting these concerns in their product pricing. Most lenders are also still being
Products available to intermediaries
are up almost 50 per cent on numbers this time last year.’
incredibly reluctant to lend to anyone but the safest of borrowers, with squeaky clean credit histories, and this has certainly impacted on general mortgage activity. Evidence points to a difficult year ahead
– the environment of historic low interest rates is generally expected to come to an end sooner rather than later, with the expectation that there will be a interest rate rise before the summer. What immediate impact any hike in
rates will have on mortgage lending is hard to predict, but with borrowers enjoying rock bottom rates for so long it is difficult to believe that mortgage activity will not be adversely affected.
30 MARCH 2011 PROPERTYdrum
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