You are here: Home - News -

Mortgage demand fell ‘significantly’ in first quarter of 2018 – Bank of England

by:
  • 12/04/2018
  • 0
Mortgage demand fell ‘significantly’ in first quarter of 2018 – Bank of England
Demand for mortgages dropped significantly in the first three months of this year, according to lenders surveyed by the Bank of England.

 

The fall in appetite came from both prime and buy-to-let, as well as remortgages, according to the credit conditions first quarter survey.

However, lenders expect remortgage demand to pick up again in the second quarter, between April and June.

The Bank of England is tipped to raise interest rates in May, which could prompt another wave of remortgaging.

In an overall review of the credit market, the Bank of England said mortgage competition has continued to intensify.

 

LTVs

Interest rates on higher loan-to-value (LTV) products have fallen since November – despite an increase in swap rates, which affect the cost of funding for lenders.

Interest rates on lower LTV products have were broadly unchanged over the same time period.

The bank said: “The major UK lenders noted that competition remains very strong and since November has increased in the higher LTV market, perhaps in part because profit-margins for lower LTV products are already squeezed.”

Mortgage lending is growing steadily, with higher remortgaging in recent months, according to policymakers.

The bank continued: “Approvals for remortgaging have risen since early 2015 and there were a couple of particularly strong months in late 2017.

“More frequent remortgaging has partly been encouraged by the increase in popularity of two-year fixed rate deals.

“Intelligence from lenders suggests a particularly large number were coming up for renewal in late 2017.”

There are 0 Comment(s)

You may also be interested in

Business Skills

In this section, we offer short ‘how to’ guides on harder to crack areas of business. From social media, to regulation or niche product areas, we cover it all.

Profiles

Our journalists interview key industry entrepreneurs, strategists and commentators for day-to-day market insight and a strategic view of where the industry is heading. We offer lessons for success and explore the opportunities for your business

Success in Practice

Here, we share case studies fleshing out best practice to help you decide what could work for your business. Take a look at how others approached complex tasks like launching a new mortgage lender, advising on a new product area or deciding to specialise in another. Learn from others mistakes and triumphs.

Marketwatch

Each week, we ask top mortgage and property commentators with a unique perspective to examine a key news headline, market move or regulatory or political issue.

Poll

Vote in our weekly poll here. It’s your chance to tell us what you think and be heard on the top news stories of the week. Review our archive to find out what your industry really thinks and all our coverage of the results.

Top Comments

Be part of the conversation on Mortgage Solutions. We want to hear from you. We have a tool called Disqus to tell us which stories get the most comments each week. Every Friday, the team picks the most thoughtful or opinionated contributions from our readers to enjoy again. Don’t forget to share your favourite stories from the site on social media to keep the conversation going.
Read previous post:
Craig Calder Barclays
Rate rise uncertainty shows value of mortgage advice – Calder

The recent performance of the UK service industry may yet provide one of the biggest indications that we could be...

Close