Growth in product numbers may be a case of smoke and mirrors
Share
The number of mortgage products available via brokers has increased 123% year-on-year, but this has not been matched by a rise in gross mortgage lending.
Over 500 new deals were intro-duced on Mortgage Brain in March - a 5% increase in product availability compared with February.
This brings the total number of mortgage schemes listed on the system to 10,418, compared with 4,665 a year ago.
But figures from the Council of Mortgage Lenders show that gross mortgage lending in 2010 was £136bn, down from £143bn in 2009.
And gross lending in January and February this year was almost static at £9.47bn and £9.5bn respectively, with January marking the lowest level of gross mortgage lending since February 2009.
Rob Roberts, IFA at Buckles Investment Services, says there may be more products on the market but it is a case of smoke and mirrors.
He says: “Product numbers are edging up to where they were in a healthy market but a lot of this is down to lenders offering differing rates for interest-only and repayment methods on the same deal, but classing it as two products when it is still only one.”
The Mortgage Brain figures show that fixed rate products witnessed the biggest movement in March, climbing 10% with 602 new products.
Variable rate products saw a slight increase of 0.5% with five new products.
Figures from Mortgages For Business also reveal that the number of buy-to-let mortgage products in the market has more than doubled over the last year.
In Q1 2010, an average of 142 products were available to buy-to-let investors.
This figure has more than doubled to an average of 298 products in Q1 2011.
This rise is due in part to the entrance or re-entry of four mortgage lenders to the market.
If you enjoyed this article, sign up here to receive daily email updates from Mortgage Strategy and Follow @mortgagestrat
