UK Housing Market Shows Continued Growth with Strong Demand in Lending
The UK housing market is growing in strength and while some are worried that the result will be a housing bubble that will wreck the effort made with the economy, it is a sign that confidence in the economy has grown. The long missing first time buyer has returned to the housing market and the property ladder is beginning to experience a strong thaw. Those that had sought to move home and either upgrade to a larger property or step down to a smaller one are finding they have buyers now.
Those homeowners that want to stick and stay in their home are also benefitting from the present state of the housing market. Property is in higher demand and that is pushing up house prices. This in turn is building property values for owners and they are seeing a return on their investment in their homes. Higher property values allow homeowners to secure lower cost remortgages and to take out cash from their built equity.
The Council of Mortgage Lenders (CML) reported gross lending for March at a level of £15.4 billion. This is an increase of 4% over February and it is 33% over the level of March 2013. The only decline was with the first quarter of the year against the previous quarter by 10%. Comparing the level of mortgage lending in the first quarter to the same last year there was a 37% increase.
Bob Pannell, CML chief economist, said, “The underlying, seasonally adjusted, picture continues to depict the strongest and most sustained activity levels for more than five years.”
London continues to experience a strong housing market. For the 9% increase in house price growth experienced in the UK, 1% of that increase is due to the influence of the strong London market.
Mr. Pannell said, “The vast majority of the housing market, and the lending to it, exists outside London, and much of it is experiencing nothing like the euphoric conditions that are filling the London media column inches.”
Lenders continue to offer attractive cheap remortgage and mortgage deals which are expected to keep the trend of strength in the housing market on track.