During July, mortgage lending increased, reaching the highest monthly level seen since August 2008.
The Council of Mortgage Lenders, or CML, says that levels of mortgage lending remain strong even though stricter regulations were introduced in April that make it more difficult to obtain a loan.
The total figure for gross mortgage lending in July was £19.1 billion, an increase of seven percent compared with June and 15 percent compared with July 2013. Property transactions rose by 25 percent during the first six months of 2014.
Even though new mortgage regulations oblige lenders to carry out more investigations into a borrower’s ability to make loan repayments, the first half of 2014 saw net mortgage lending reach a healthy £10.5 billion. This is the highest six-month total seen for the past five years, in which 12-month totals hardly rose above £10 billion.
A CML analyst, Caroline Offord, said that the economy has picked up, with a more positive outlook indicated by the Bank of England since May this year, and described the recent mortgage lending figures as “a sign of growth in the market”. However, she added that the housing market is still vulnerable to rises in interest rates.
As the mortgage market changes, more people are turning to advisors before they apply for a loan, but it is important to choose a professional with a recognised qualification. Reputable mortgage advisors will have taken CeMAP training in London, Manchester or other major UK cities, and they should be able to help home buyers find the right deal.
