Lenders reported that secured lending for house purchases saw increased demand in Q3, The Bank of England’s Credit Commissions Survey has found.
Demand for secured lending for remortgaging decreased in Q3 but is expected to rise in the next quarter.
Jeremy Leaf, north London estate agent and a former RICS residential chairman, said: “The Bank of England credit conditions report is always a very good way of assessing future trends in the property market.
“This quarter’s figures are no exception and show a modest recovery in demand for mortgages but little expectation of the uplift being maintained.
“The results mirror much of what we are seeing on the high street – some initial increase in activity over the summer which hasn’t been maintained while political uncertainty remains, with transactions taking longer than expected and many sellers reluctant to put their properties on the market.
“Unfortunately, this is restricting choice for the buyers that do want to look beyond Brexit.”
Michael Biemann, chief executive of digital property lender, Selina Finance commented on the survey’s findings that default rates on other loans rose in Q3.
Biemann added: “With money so cheap, there is a lot of debt out there and the worry is that for some people it is starting to prove too much, and at just the wrong time as we enter a potentially tough period for the economy.
“Given the rise in default rates, it’s no surprise credit scoring criteria for unsecured loans tightened in the third quarter. The high street banks are becoming increasingly cautious.
“For secured loans, the default picture looks considerably healthier, in part because of the tighter underwriting and better affordability that apply to this type of borrowing.”