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More million pound mortgages approved by lenders

In 2016, the number of mortgages valuing £1 million in the residential market rose by 24%, according to a study by Lendy, a peer to peer secured lending platform.

The research shows that the number of mortgages worth £1 million or more and approved by banks had reached 4,844, in comparison to 3,896 during 2015. The total value of these mortgages in 2015 was £7.59 billion, while in 2016 the figure had increased to £8.95 billion.

However, the study also discovered that lending to property developers had fallen during the same period, falling by 7% last year to £14.8 billion. In 2015, the figure had reached £16 billion.

Lendy warned that the housing crisis in the UK could get worse if banks continued to neglect property developers in favour of owner-occupiers. The co-founder of Lendy, Liam Brooke, said:

“As more and more money goes to owner-occupiers, boots will struggle to get on the ground working to hit the Government’s housing target.”

Brooke added that unless banks started to lend to developers who could build large numbers of homes rapidly, the housing targets would continue to be missed. He warned that smaller developers would be losing out if banks continued to favour lending to owner-occupiers. According to Brooke, companies like his peer to peer platform are making more and more contributions to helping new developments get started.

Despite the increased number of mortgages worth a million or above, it can still be difficult for a first time buyer to find an affordable deal, which is why CeMAP qualified mortgage advisers are available to provide advice.

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