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Home > Mortgages > Mortgage Data

By Simoney Girard | Published Sep 11, 2012

FSA mortgage data show tiny increase

Over the second quarter of 2012, outstanding loans were up 0.1 per cent on the previous quarter, at £1,223bn, while net advances amounted to £37bn, a mere 1 per cent increase on quarter one 2012 and the same as quarter two last year.

According to the FSA’s data, the overall average interest rate on new advances rose from 3.50 per cent to 3.78 per cent in Q2. This resulted from increases in the rates for both variable rate lending and for fixed rate lending.

New commitments totalled £40bn in the quarter, a 7 per cent rise from last quarter but very similar to the amount in Q2 last year.

Lending for house purchase accounted for 62 per cent of new advances, up on both last quarter and on Q2 2011, and for 65 per cent of commitments, the highest proportion yet recorded. As a consequence, the proportion of advances for remortgages fell back to 31 per cent.

The proportion of new lending done at an LTV of more than 90 per cent was just above 2 per cent for the second successive quarter, reflecting the FSA’s tougher line on high LTV products and the ensuing removal of high LTV mortgages from the market place over the past year.

In total, new possessions in the quarter fell by 9 per cent to 8720, despite the government’s many schemes such as its FirstBuy Scheme, which last week received a filip in the form of an additional £280m pledged to help first-time buyers onto the property ladder.

Grenville Turner, chief executive of Countrywide, said: “It is encouraging to see a £280m extension of the Government’s FirstBuy initiative, which will help more first-time buyers get a foot on the housing ladder. However, it would have been good to see the government take further measures to help second-time buyers and home movers by abolishing stamp duty for all properties worth £250,000 and under.

“One of the critical factors hindering the UK housing market is financing and deposit affordability. The Government should do more to encourage all lenders, not just state-backed lenders, to set minimum and meaningful mortgage lending targets.”

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