The mortgage market improved sentiment

In the market of residential property in the UK there has been a significant improvement in sentiment, as evidenced by new data on size of lending, which reached its the highest since October 2008.

According to information provided by the Council of Mortgage lenders, total gross size of mortgage loans increased in July to 16.6 billion, showing a growth of 12% from 14.8 billion in June. The Eton is 29% higher than in July last year.

For the first time the lending sector is at such high levels since the beginning of the banking crisis. The government program “The Funding for Lending scheme” “the Scheme of financing lending,” performed a miracle, by supporting the availability of mortgage loans and giving impetus to competition between banks. Pouring public money into this sector of the economy, the government eased the burden on the banks and construction companies, which have significantly reduced their costs and are faster to move forward, developing new financial products and new construction projects.

In addition, the program “Help to Buy” has become another incentive for banks to increase lending, by providing loans with a higher LTV. Mortgage rates are now at historically low levels and lenders are able to extend their product range by modifying their loans so that they are available a wide range of buyers.

Among the creditors of the observed sentiment, expectations that in the second half of the year, they will see even more activity in the market. Indeed, the size of the gross loan on the market during the first six months amounted to over £75 billion. Given that the third quarter is usually stronger than, the expected size of the gross lending in 2013, at £160 , well above 2012, when he was made figure 142,5 billion

Against the background of a strengthening market, more consumers are turning to mortgage brokers, be interested in the range of mortgage products on offer.

Financing through public funds gave impetus to creditors, boosting healthy competition. Which, consequently, led to a drop in interest rates for year mortgage rates fell by an average 1%, after experiencing two, three, and five adjustments .

Despite the fact that among lenders and among borrowers there has been some recovery of confidence, which was destroyed over the last few years, you need to keep in mind that the recovery of the mortgage market is due to the artificially created government initiatives. If we will witness such progress in the market without constant injections from the state, then this would indeed be cause for celebration.

® Helen Antre 19.08.2013