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Research & insight article

Chrome Report 2015 Mortgage Market

Mortgage market UK

With the likelihood of interest rates rising this year appearing to diminish, the window of opportunity for buyers to take advantage of some very attractive mortgage deals looks set to remain.

Nick Barnes, Head of Research


Latest data from the Council of Mortgage Lenders shows that UK mortgage lending in January fell by 11.3% compared to December and was 13.8% lower than in January 2014. Within London, the total number of loans advanced for home-owner house purchase in 2014 was 85,800 - up 3% compared to 2013. The value of these loans amounted to £24.3bn, an increase of 13% compared to 2013.

–– Research from the Mortgage Advice Bureau (MAB) reveals that buy-to-let (BTL) borrowers are putting up more equity on their mortgage loans in a bid to shorten the term of the loan. According to MAB, average BTL equity amounts rose by 15% in 2014 to average almost £100,000. However, the average
value of BTL properties bought with a mortgage remained broadly static at £230,000.

–– Research from the Intermediary Mortgage Lenders Association (IMLA) suggests that the recent tighter regulation – especially interest rate stress tests - is
hampering the lending market. 84% of brokers have been unable to help at least one customer in the last six months, up from 78% in July 2014. Products for the self-employed or those seeking to borrow into retirement are among those in short supply and people with low incomes or dependents have been most affected by reduced access to finance.

–– The Money Charity has warned that more than 1.75m mortgaged households have never experienced a rise in the Bank of England base rate, putting them at risk of a financial shock when rates do increase. According to The Money Charity’s analysis, there have been 1,762,400 first-time buyers since July 2007, the last time Bank Rate was increased.

–– Despite the favourable mortgage interest rate environment, the volume of remortgaging continues to decline. The number of new loans for remortgaging
in January fell by 7% compared to the previous month and was 30% lower than in January 2014.
NB comment: with the likelihood of interest rates rising this year appearing to diminish, the window of opportunity for buyers to take advantage of some very attractive mortgage deals looks set to remain. However, sustained economic growth and a jump in inflation could quickly change the mortgage environment – prospective buyers take note.
Oxford Street Article Details

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Nick has more than 20 years’ experience within the property research arena.

Nick Barnes

Nick Barnes

St Magnus House

020 3040 8406