On average, the maximum loan size offered by lenders was £243,400 in May this year, up by 2.5 per cent compared to the average £237,500 in May 2020.
By comparison, average house prices were up 9.5 per cent, or £22,000 in the past year, according to the Halifax House Price Index.
The MBT Affordability Index for May further found that the spread between the minimum and maximum loan sizes offered to customers had grown to £100,900 in May 2021, up from £89,893 in May 2020.
For first-time buyers, the average maximum loan size rose by 2.7 per cent to £253,764 in May compared to April 2021. For buy-to-let investors, the rise was 3.6 per cent to £362,750 month-on-month.
Tanya Toumadj, chief executive at Mortgage Broker Tools (pictured), said: “Property prices have risen at their strongest level in nearly seven years over the last 12 months, according to the Halifax House Price Index. Mortgage lenders have increased their appetite to offer customers larger loans in the same period, but not nearly at the same rate.”
Toumadj added that the spread was growing between the largest loan sizes offered to customers by different lenders.
