Lending is increasing, but the lack of properties will remain a threat to potential mortgage borrowers, Stephen Smith has said.
The director for Legal & General Mortgage Club & Housing, said: “Mortgage lending has rebounded after a slow start to the year, where pre-election uncertainty caused some people to postpone entering the market.
“The resultant backlog of prospective buyers is driving up demand in months that typically see less activity.”
Although he said he expected lending to continue increasing as rising wages and low inflation were likely to encourage more people to the market, he believed the lack of supply continued to be the main threat to the market.
He said: “Potential buyers’ affordability will become increasingly strained unless more homes are built to cope with the current level of demand. We need 250,000 extra houses to be built a year.”
The UK is falling well short of that target, with a mere 118,760 homes built last year, he said.
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Richard Bousefield, founder of The Surrey Mortgage Broker, said: “A lack of supply is certainly a factor, but could something also be done about the approximately 1m houses that are estimated to be sitting empty in the UK?”
