January did see a pick-up in lending compared with previous Januarys, according to the Council of Mortgage Lenders this morning, although there was a seasonal dip compared with December’s figures.
Some 38,300 mortgages were advanced for house purchases, down 17 per cent on December but up nearly 11 per cent on January 2012.
So have we turned a corner? Bien Media client SPF Private Clients certainly thinks the signs are encouraging. Mark Harris, the chief executive, said: ‘January is never the busiest month of the year for the housing market as it tends to get off to a slow start after Christmas but the numbers look particularly good when compared with previous Januarys, suggesting recovery is underway.
Funding for Lending
‘Encouragingly, there are more first-time buyers around helping boost these numbers, which is crucial to the health of the housing market. They are still putting down a 20 per cent deposit, on average, and with the Funding for Lending Scheme (FLS) making more deals available at 90 per cent loan-to-value, this should further increase the number of first-time buyers able to get on the housing ladder in coming months.
‘Remortgaging numbers are still subdued, perhaps surprisingly when there are so many excellent deals out there at the moment. It may be that borrowers are sat on attractive reversion rates or SVRs so don’t wish to remortgage, or perhaps they are trapped because of tighter criteria or lack of equity in their homes so can’t switch. There may also be borrowers holding out for even better rates but with the Government’s threat to divert more FLS money towards small businesses rather than mortgage borrowers, there may be more urgency in coming weeks to secure a deal before it disappears.’