Prospects for the UK mortgage market this year look rather optimistic, according to the latest membership survey from the Intermediary Mortgage Lenders Association (IMLA). IMLA members, who account for over 80% of lending in the intermediary sector, anticipate that gross mortgage lending will total £150bn in 2013, with net lending of £9.3bn. Both predictions are slightly lower than the forecasts from the Council of Mortgage Lenders (CML) of £156bn gross lending and £12bn net lending, but still point to lender optimism about growth. The IMLA predictions follow a strong end to last year for the UK mortgage market, with £11.7bn of gross lending during December bringing the total estimate for 2012 to £143bn, including net lending of £9bn. An estimated 930,000 residential property transactions were recorded in 2012 – the first time this has exceeded 900,000 since 2008, and significantly more than the CML prediction of 825,000.
Anticipated Trends in High LTV Lending
On average, IMLA members anticipate 940,000 residential transactions for 2013, though 40% felt the total will be higher and 20% predicted more than 1m residential transactions over the next twelve months. IMLA members also expect high LTV lending to rise, with the greatest increase in high LTV lending set to occur in the 85-89% bracket. Over half (58%) expect to see up to a 10% increase in the number of 85-89% LTV loans, while almost a quarter (21%) expect to see growth of up to 15%. More than half of members (57%) also expect to see up to 5% growth at the 90-94% LTV level. However, almost all members (86%) say there will be no more lending at 100% LTV during 2013 than there was in 2012. Peter Williams, executive director of IMLA, said: “It is encouraging to see our members taking a positive, yet pragmatic, outlook for 2013.
There is a general consensus that we will see positive growth in the UK housing market, both in terms of mortgage lending and total residential transactions. Industry figures show that 2012 ended on a high note, and we have every reason to expect this to support further recovery in the market this year.
Article courtesy of Property Investor Today
