Advantage predicts continued lender growth in 2006

Ramesh Sharma

January 21, 2006

The branded mortgage arranger said the average loan size increased slightly to £113,877 despite the usual reduction in activity during the run-up to Christmas.

This slight growth is expected to continue into 2006 and Advantage managing director Kate Huet is expecting a good year for lenders.

She said: “We predict 2006 will deliver greater product innovation amongst the leading current non-conforming lenders. Coupled with this, new ranges will deliver to the market even more choice with flexible underwriting providing to brokers a stronger competitive edge enabling them to deliver the best product solution.”

Advantage expects debt consolidation to expand in the early months of 2006 with clients looking to restructure their finances after the Christmas period. It added that brokers could see increased business in the New Year.

The index also found the number of first-time buyers in the market showed a significant increase during December, in contrast to continued fears that high house prices are making it difficult to get onto the market.

Duncan Pownall, mortgage development manager at Bradford & Bingley, said this new influx of first-time buyers will continue into 2006.

“I certainly expect there to be more first-time buyers in the market, especially as lenders move more towards affordability-based lending. There hasn’t been a property crash which many were expecting so that should renew confidence in buyers, while we should see the Base Rate come down, which will also help.”

“Also, the average rise in wages should catch up with house price rises which should help more people into the market during 2006,” he added.

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