Mortgage lending on the rise according to CML
According to the CML’s latest figures, gross mortgage lending in January has risen 10% year on year and, despite being down on the figures for December, marks the sixth consecutive month of an increase in year on year lending in the property market.
Experts posit that part of this rise has been the Stamp Duty holiday which ends soon and has definitely caused an influx of first time buyers looking to buy a property before the holiday ends in March. But it is also possible that since the recession optimism is finally growing when it comes to both lenders and borrowers, with people feeling more secure about making a financial investment for the first time in a number of years. Add to this that property prices are still low whilst rents are high and the attractiveness of buying a property is rising steadily.
For first time buyers and contractor mortgages in particular, this year looks likely to be a more encouraging year, with lenders easing up o their tighter rules and restrictions and bringing back high LTV mortgages for those without a solid deposit saved.
The property market does seem to be strengthening in recent months, which has led to an increase in lenders creating new deals and discounts to encourage people into the property market, making mortgage rates more affordable than ever before and giving options to those who would otherwise have found themselves trapped in a cycle of renting. With new shared ownership schemes working well for young first time buyers and those looking for mortgages for contractors alike, 2012 looks to be a year in which many new property owners crop up and hopefully the stress on the rental market may ease up.
Where interest only deals continue to tighten and lenders are slashing their borrowing on this type of mortgage, experts believe this will improve the interest only market in the long run, as many people reaching the end of their interest only mortgages in recent years have had a shortfall and struggled to pay off the debt. If these types of mortgages are stricter it should encourage borrowers to go for a more straightforward repayment mortgage to ensure that they pay off the full amount by the time the loan matures and this should create less stress on the property market, making for even more secure lenders and yet more mortgage deals and happy property owners.
Article by: Rebecca Sidwell, Associate Director at Contractor Mortgages Made Easy
Media Contact: Raman Kaur, Public Relations Manager.
Tel: 0844 44 88 800
Email: media@contractormortgagesuk.com
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