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TODAY'S OTHER NEWS

Mortgage market set for buoyant end to 2015

The mortgage market is enjoying a buoyant end to 2015 as two new sets of figures published yesterday show continuing strong growth.

The Halifax house price index showed prices rising a healthy 1.4% in the three months to 30 September.

Prices in the three months to November were 9% higher than in the same three months a year earlier, a slight easing from 9.7% in October.

Martin Ellis, Halifax housing economist, said: “Solid economic growth, rising real earnings and falls in already very low mortgage rates have combined to stimulate housing demand this year.

“The increasingly acute imbalance between supply and demand is causing prices to rise at a robust pace. A situation that is unlikely to reverse significantly in the short-term.” 

Jeremy Duncombe, director, Legal & General Mortgage Club, said the gulf between supply and demand is continuing to push buyers out of the market.

“Across all areas of the market, buyers and movers are suffering."

Mortgage Lenders and Administrators statistics for Q3, also published yesterday, showed an 11% year-on-year increase in gross advances.

Brian Murphy, head of lending at Mortgage Advice Bureau (MAB), said the spike in demand was driven by record low mortgage rates, due to increased lender competition and the continually low base rate.

“More and more borrowers have been fixing their rates in order to secure the best possible deals, with the proportion opting to fix climbing above the 80% mark for the first time this year."

He warned that these attractively priced rates won’t be around forever.

Murphy was concerned by a drop in 90% LTV lending to just 3% of the market.

“It is important that there are plenty of higher-LTV products on as house prices continue to rise. Otherwise, lower income borrowers will struggle to get a foot on the housing ladder.”

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