Gross mortgage lending, paced by high degrees of remortgaging, was still strong in March according t...
Gross mortgage lending, paced by high degrees of remortgaging, was still strong in March according to the Council of Mortgage Lenders' monthly statistics.
These figures show that gross mortgage lending amounted to a total of £19.3bn in March this year, compared to a total of £16.1bn in March 2002, with remortgaging accounting for half of all lending.
However, even though an overall monthly increase in lending could be seen, lending for house purchases was 13% lower compared to last year.
This is the first time lending for house purchase has demonstrated a slope compared to year-earlier figures since June 2002, says CML, as lending for house purchase accounted for less than half of all lending this March.
According to the CML, the statistics for first time buyers and for former owner occupiers for loans for house purchase are as follows:
|Period||Number of Loans (000s)||First Time Buyers % of Loans||Former Owner Occupiers % of Loans|
|Period||Number of Loans 000s||First Time Buyers % of Loans||Former Owner Occupiers % of Loans|
Source: CML< April 2003
"The mortgage market is still performing very strongly, although remortgaging is the main driver of the current buoyancy," says Michael Coogan, general director at CML.
"It is still too early to say whether the housing market has yet passed the turning point towards a slow down in house prices and transactions. The lower year-on-year level of lending for house purchase suggests the market may be returning to more normal levels, although it is important not to read too much into a single month's figures."
CML's figures also shows that fixed-rate borrowing have become more adopted in March, with fixed rates accounted for 47% of new lending, compared with 30% last year.
This is mainly because the gap between average new fixed rates and average new variable rates has tightened, says CML that believes this strengthens its outlook that a key issue for the Government's review of the consumer and market demand for long-term fixed rates is the comparative cost of variable and fixed rate funds.
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