The Council Of Mortgage Lenders Report Stability In The Mortgage Market
According to the Council of Mortgage Lenders there have been further signs of stability in the mortgage market as lending for both house purchasing and remortgaging has increased in June.
The figures released by the Council of Mortgage Lenders show there has been a 23% increase from 36,500 loans in May to 45,000 loans totalling £5.9 billion in June. However taking the last seven years into consideration this figure is less than half the average June figure
The biggest uptake in the mortgage market in the second quarter has been fixed rate deals at 78% of all new deals, and has been the largest share since June 2007. This figure may reflect the higher levels of fixed rate deals in the mortgage market and is purely supply driven.
Other figures released by the Council of Mortgage Lenders show that first time buyers are typically putting down a 25% deposit which is unchanged since February. First time buyer’s income multiples have increased to 3.08 times their income in June compared to 3.04 in May. Existing homeowners borrowed on average 2.76 their income in June, compared to 2.74 in May. Those moving home typically borrowed 69% of the property’s value in June, which has remained the same compared to the May figure.
CML economist Paul Samter said: “Low interest rates and realistic selling prices have helped generate a welcome increase in transactions. But there is some way to go before we reach normal levels of activity. There are tentative signs that lending criteria are easing, but remortgaging demand is likely to remain subdued whilst interest rates stay at current levels.”
The Council of Mortgage Lenders’ is comprised of banks, building societies and other lenders who combined make up around 98% of all the residential mortgage market in the UK.