The expectation is for first time buyers to return to the housing market as loans become more available with an ease in lending.  Loan to value levels on low interest mortgage loans is helping to catch the attention of buyers that had previously been unable to get approvals as well as those that lacked confidence in it being the right time to buy.  According to the Council of Mortgage Lenders (CML) the coming year will see a possible rise in lending to £156 billion.  In 2012 lending rose to £143 billion with £11.7 billion advanced in December 2012.

Bob Parnell, chief economist with CML, remarked, “We are more positive about the UK housing market and wider economy than a year ago, despite economic headwinds and downside risks. A key reason is that lenders currently face few funding pressures, in part reflecting the funding for lending scheme. House purchase activity was robust in the fourth quarter, on the back of better mortgage availability and pricing, and we expect this to continue over the coming months."

The Funding for Lending Scheme is being credited with the new optimism being thrown at the current housing market.  In regards to the scheme, the CML stated, “While it is still early days for the FLS, and so uncertainties around its effectiveness are understandable, the scheme clearly adds another monetary weapon to the Bank of England's armoury. Recent MPC decisions to refrain from further quantitative easing (the previous increase to £375 billion was completed before November's MPC meeting) in part reflect an expectation among policy-makers that the FLS will stimulate lending over the coming months.

“It is worth noting that the amount actually drawn under FLS - about £4 billion, according to the Bank's early December report - is relatively small so far. This suggests that much of the initial benefit from the FLS has been an indirect one, as UK lenders need to raise less money from wholesale or retail sources. With limited volumes of issuance, spreads have continued to tighten, and in some cases fallen back to pre-crisis levels.”