It’s an en­cour­ag­ing sound

Harefield Gazette - - PROPERTY - PAUL GILLE­SPIE; 020 8426 1972; pgille­spie@gibbs-gille­; www.face­­s­gille­spie; Twit­ter: @gibb­s­gille­spie

DE­SPITE a fair amount of neg­a­tive press about the hous­ing mar­ket, there is a sim­i­lar noise to that of a ‘boom’ em­a­nat­ing from the re­cent mor tgage fig­ures.Th­ese num­bers show no sign of slow­ing down – home­own­ers bor­rowed £220.3bn last year, up 8% on 2014 and the high­est level since the star t of the fi­nan­cial cri­sis in 2008.

Lend­ing in De­cem­ber, typ­i­cally a quiet month for house buy­ers, hit £19.9bn, up 23% on the same month a year ear­lier and nearly as high as the £20.5bn re­por ted in Novem­ber.

The sta­tis­tics, from the Coun­cil of Mor tgage Lenders (CML), sug­gest the proper ty mar­ket is still hot, de­spite grow­ing con­cern that over-in­flated val­ues are pric­ing out first-time buy­ers.

Mark Car­ney, the gov­er­nor of the Bank of Eng­land, pro­vided good news that in­ter­est rates will stay low for at least an­other year, which means mor tgages will re­main cheap and con­tinue to sup­por t the mar­ket.

Jeremy Dun­combe, of Le­gal & Gen­eral’s Mor tgage Club, said the proper ty mar­ket was largely be­ing driven by a shor tage of houses for sale stat­ing: “2015 has been an ex­ceed­ingly strong year for mor tgage lend­ing, and we ex­pect favourable UK eco­nomic con­di­tions to fur ther drive de­mand in 2016. That said, the num­ber of trans­ac­tions has re­mained rel­a­tively flat through­out the year as a re­sult of the lack of avail­able hous­ing stock for buy­ers.This is con­trar y to the in­creases we are see­ing in lend­ing, show­ing that this strong per­for­mance is be­ing driven in par t by es­ca­lat­ing house prices as peo­ple are hav­ing to take out larger loans to se­cure a proper ty.”

But with a rate rise now post­poned, many econ­o­mists be­lieve pres­sure on the mor tgage mar­ket may re­duce.

Howard Archer, chief econ­o­mist at IHS Global In­sight said:“Mr Car­ney’s speech will likely re­duce the per­ceived need of a sig­nif­i­cant num­ber of home own­ers to re-mor tgage now to lock in low rates be­fore they rise. It may also di­lute the per­ceived need of some home buy­ers to move in the near term to make sure they can take ad­van­tage of ver y low mor tgage rates. On the other hand, more peo­ple may be in­clined to buy a house in the knowl­edge that in­ter­est rates are likely to stay lower for longer then only creep up.”

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