“Today’s figures continue to paint a picture of a stronger market that is better equipped to meet pent-up demand from first time buyers, as well as smoothing the path of home movers looking to scale the housing ladder. We have now seen over £50bn of gross lending in the last three months alone [to October], and with the closure of the Funding for Lending Scheme (FLS) for mortgages in 2014 there is every incentive to make as many loans as possible before the year end. Of course this might trigger a lull early next year but there is an extra kick to come when the gates fully open for lending to applicants through the Help to Buy mortgage guarantee scheme.
“The lack of movement in the average size of first-time buyer loans compared to the value of their homes* shows how important it is to support higher loan to value (LTV) mortgages. With challenger banks actively joining high street brands within Help to Buy 2, we should see more progress on this score from January. This added impetus will be welcome relief for those first-time buyers still finding it hard to raise a deposit.
“Overall, confidence has replaced hope for buyers seeking a mortgage, and the market as a whole is approaching the year end with more optimism than has been the case for many years. Growth of house prices and overall lending remains modest compared to historic levels and the Bank of England has a stronger remit to guard against excess growth. We can expect Bank of England action if it is required.”