Purchase loans take lion’s share
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House purchases in August accounted for the largest share of total mortgage lending for seven years.
Figures from the Council of Mortgage Lenders show that house purchase activity - worth £7.2bn in August - represented the highest proportion of total mortgage activity since 2002.
Remortgaging activity continues to decline, with 32,000 remortgage loans advanced in August, a 22% drop from the previous month and a 57% fall from August 2008.
There were 53,000 house purchase loans in August, down 5% compared with July but 29% more than in the same month last year.
House purchase activity remains below the average of 100,000 loans recorded in August for the past seven years but has doubled since the start of the year.
There were 19,200 loans to firsttime buyers and 33,400 loans to home movers.
Gross mortgage lending including purchase, remortgage and buy-to-let loans reached £12.3bn in August, 36% down on August 2008.
Meanwhile, a survey by property website Zoopla.co.uk reveals that 79% of home owners believe property values will rise in the next six months.
Of the 6,682 owners surveyed, 79% believe values will rise, with only 11% thinking they will fall. Respondents expect house values in their area to rise 5.4% in six months.
Stuart Law, chief executive of Assetz, says that as soon as lenders are confident the housing market is making a sustained recovery they willoffer more attractive products.
He says: “I expect this to happen within three months of the big price indices turning positive, which means better deals in Q1 2010.”
