Latest figures show that gross mortgage lending was up by 43% in February, reaching its highest level since the recession.
According to the latest data from banks and building societies, gross mortgage lending was up by 43% in the year to February, highlighting a turnaround in the property market over the past year. In a usual seasonal dip, lending fell by 6% from January to February this year, but the Council for Mortgage Lenders (CML) said its members had recorded their strongest February performance since 2008.
A grand total of £15.2 billion was advanced to home-buyers over February, an increase of £10.6 billion on February 2013.
It has been a year since chancellor George Osborne announced the government’s Help to Buy scheme in his 2013 Budget. This, along with the Funding for Lending Scheme, are said to be behind the pick up in the market. In last week’s Budget, the chancellor announced that Help to Buy will be extended for new build homes until 2020.
Chief economist at the CML, Bob Pannell, commented on the figures:
“Housing market indicators have continued to be strong over recent months, once seasonal factors have been taken into account.
“First-time buyers have benefitted most from the government’s Help to Buy initiatives, with the more recent mortgage guarantee scheme now starting to push typical loan-to-value levels higher.
“The housing market got a further boost from this week’s Budget. This, together with benign developments in the economy more widely, should bolster short-term sentiment and activity.”
Brian Murphy, head of lending at the Mortgage Advice Bureau, said:
“Help to Buy is continuing to open up the market to those with smaller deposits, while consumer confidence and demand has flourished – firmly placing us on the road to recovery.”
He added that if the recovery is to continue, the housing shortage must be addressed.