Despite figures released last week by the British Bankers’ Association showing gross mortgage lending had fallen to its lowest level since February 2001, talk of the market rapidly declining may be premature if visitors to our sister site Moneysupermarket. com is anything to go by.
Although our mortgage channel saw a decline in visitor numbers in October the number of consumers searching for mortgages on the site remained steady throughout 2010, contrary to media reports that borrowers are deserting the market.
Unsurprisingly, we saw a small shift towards searches for fixed rate deals as borrowers look to protect themselves from future base rate rises. It looks like these may arrive in the first half of 2011.
So it is good to see competition returning to the fixed rate market with a number of lenders reducing rates recently, although the most competitive deals are still only accessible for those with sizeable deposits.
Another ray of hope is that the number of first-time buyers searching for products through Moneysupermarket.com has remained high.
This indicates that appetite still exists even if products remain in short supply.
Many first-timers are being priced out of the market as the best mortgage deals require deposits of at least 40% – way beyond the means of most borrowers.
Lenders need to be brave and open up the market for these borrowers or we are likely to see stagnation in the housing market for years to come.