CML reports strong mortgage market
Despite a drop from December’s total of £26.9 billion, the lending figures for January showed lending rose to almost a third higher than January 2005’s total of £17.4 billion and revealed consumer confidence and market conditions, including low interest rates, were strong in a time typically associated with slow house buying activity.
Commenting on the data, Michael Coogan, CML director-general, said a strong market had helped shift market trends to improve lending figures for the traditionally slow Winter to Spring period.
He said: “Mortgage lending in all categories has been strong in recent months. This reflects the fact that consumers are feeling more certain about the future of the housing market and confident that house prices are unlikely to fall. The interest rate outlook for the near future is for stable rates. Our recent figures show that the majority of new borrowers are taking out fixed rate loans to provide payment certainty at affordable cost. The mortgage market looks set for continued steady growth against a backdrop of pretty positive economic conditions.”
Duncan Pownall, mortgage development manager for Bradford & Bingley, also welcomed the results, which indicated buyer buoyancy within the market. He said: “This month’s figures demonstrate that despite the traditional seasonal market slowdown, borrowers are confident that the ‘slump’ will not materialise. As house prices grow and interest rates remain stable, borrowers are choosing to act now. The strong levels of fixed rate borrowing may indicate that borrowers are stretching themselves, happy that their payments will remain fixed at a manageable level.”