Mortgage market hopes dashed as lending data disappoints

Hopes for a rebound in the mortgage market have been dashed as lending data shows a decline in borrowing for homebuying. The number of new loans for first-time buyers fell by 3%, while loans for home movers dropped by 6.6%. Despite expectations of rate cuts, increased mortgage applications have not translated into actual lending. The Bank of England is now expected to cut rates in August or September. UK Finance predicts some growth in the second quarter, but the overall outlook for mortgage borrowing remains challenging. Affordability pressures and cost of living concerns continue to impact the market. Affordability pressures have also led to a decline in external lending and an increase in internal product transfers. The number of mortgage customers in arrears has grown, but repossessions remain below pre-pandemic levels. 

City AM (04/05/2024)