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TODAY'S OTHER NEWS

Mortgage market starts 2016 "with a bang"

The mortgage market has started 2016 "with a bang" as gross mortgage lending rose 21% year-on-year.

Lending hit £17.9 billion in January, according to the Council of Mortgage Lenders, against £14.8 billion one year earlier.

This is the highest total for a January since 2008 at £25.2 billion, although it is 9% lower than December’s total of £19.8 billion.

CML economist Mohammad Jamei said: “UK market fundamentals are helping to underpin this recovery, with real wage growth, an improving labour market, competitive mortgage deals, and government schemes all supporting household demand.

“We still only see limited upside potential going forwards, as the number of properties for sale on the market remains low and affordability pressures weigh on activity."

Adrian Gill, director of Reeds Rains and Your Move estate agents, said: “The mortgage market has gone off with a bang in 2016.

“A tamed base rate, cheaper mortgage finance and a range of Government incentives have brought a blast of new buyers onto the scene, making it a prime time to put your property on the market.”

Mark Harris, chief executive of mortgage broker SPF Private Clients, said cheap mortgage rates, challenger banks and schemes aimed at helping first-time buyers are creating a buoyant market. 

“With the Bank of England suggesting that interest rates won’t rise for many months to come, confidence among borrowers is high."

Harris said that affordability constraints will continue to hold some people back and buyers need good advice to negotiate today's complicated mortgage maze.

Jeremy Duncombe, Director, Legal & General Mortgage Club, said the growth in house price inflation had driven lending to seasonally high levels.

"It is crucial to note that the annual rise in gross mortgage lending largely reflects an increase in the size of loans rather than the number secured.”

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