The frustration felt by many individuals that banks still do not seem to be lending in sufficient quantities is still evident in the latest Lending To Individuals figures from the Bank of England, which explains the frustration felt by many would-be borrowers.
Just 47,643 loans were approved for house purchases and a mere 29,949 loans for remortgages meaning that both sets of figures have now dropped below their previous 6 months average.
First-time buyers have every right to feel discriminated against, as while mortgage lending has become more profitable for many lenders, it is too often targeted at those customers who are already well catered for. Lenders are continuing to walk the easy path.
Much more needs to be done by lenders in order to revitalise the mortgage market. While new entrants such as Metro Bank are welcome, more competition and innovation is required to meet current levels of demand, which are almost certainly higher than the banking world would have us believe.
Meanwhile Nationwide’s latest House Price analysis shows that prices fell by 0.5% in July, with the annual rate of house price inflation slipping to 6.6%.
With more properties coming on to the market and difficulties in obtaining mortgage finance still evident to many, it seems that this is likely to be the trend for the rest of the year. Whilst certain areas will hold their value better than others, especially within the more sought after areas of London where the supply of good quality stock is still light, the recent spurt in house prices is unlikely to be repeated again this year.
The good news for those who are able to access the highly competitive mortgage products now on offer is that the second half of this year could well be an excellent time to purchase.