Mortgages  

London lending on track for more rises in 2014

The managing director of London-based advisers Springtide Capital said “initial teething problems” with mortgage processing times as a result of lenders implementing affordability assessment changes following MMR would be over by the end of June, with a surge expected in the third quarter of the year.

He said: “We predict that, by the third quarter of the year, the situation will improve again, as the lending appetite is still there and, encouragingly, has not subsided in spite of the recent regulatory turbulence.”

Last year, Council of Mortgage Lenders figures showed yearly gross mortgage lending of £175bn. Last week, figures from the trade body showed that while Greater London lending for homeowner house purchasing in the first quarter of 2014 totalled 20,800 new loans, down 13 per cent on the previous quarter, it still represented a 22 per cent increase compared to the first quarter of 2013.

Article continues after advert

The value of new loans to homeowners for house purchase was £5.6bn, down 10 per cent on the fourth quarter of 2013 but up 37 per cent compared to the first quarter of 2013.

First-time buyers in Greater London took out 11,900 loans, a fall of 11 per cent compared to the fourth quarter of 2013 but up 29 per cent compared to the same period in 2013.

These loans totalled £2.7bn in value, 9 per cent less than the previous quarter but up 49 per cent compared to the first quarter of 2013.

The typical first-time buyer in Greater London borrowed 3.83 times their gross income in the first quarter of 2014, higher than the UK average of 3.42.