The EY ITEM Club report said although this had risen in recent years, mortgage lending levels remain lower than pre-financial crisis levels considering the current climate of historically low interest rates and favourable lending terms.
According to the economic analysts, the proportion of new mortgage lending at loan to value ratios at or above 90 per cent had reached a post-crisis high of 18.7 per cent in Q1 2019 due to “accommodative” lending terms.
Referring to UK Finance statistics which showed gross lending in the residential market increased by 3.7 per cent year-on-year and Bank of England figures which showed mortgage approvals remained at 66,000 in September, EY said growth in mortgage lending remained “stable” over the years.
“This is a pace which has seen little deviation since 2016 and remains a long way from the double-digit rates seen in the decade preceding the financial crisis,” the report said.
It also predicted that 2020 would be another year of “no change in interest rates”.
Omar Ali, managing partner of UK financial services at EY, said: “Political uncertainty is tempering consumer and business appetite to invest or spend, and further constraining economic growth and the associated opportunities for financial services firms.”