Catch22 Posted September 16, 2005 Share Posted September 16, 2005 (edited) Link to the Article Secured loans demand 'to ease off' The Press Association Friday September 16, 05:04 AM Demand for secured loans is set to cool over the coming five years as the property market continues to slow down, research has claimed. Market analyst Datamonitor said the double digit growth in secured lending seen during the past few years was unlikely to be repeated in the near future. Instead it expects total advances of the loans, which are secured against people's homes, to increase at a rate of just 5.3% a year between now and the end of 2009 to reach £35.4 billion a year. This is well down on jumps of 50% a year recorded over the past five years, with total advances reaching £32.6 billion last year, well up on the previous year's figure of £28.1 billion. Author of the report Maya Imberg said: "As the UK's housing market slows to a soft landing, the rapid growth rates the secured lending market has enjoyed over the last five years are set to cool." The group said soaring house prices had boosted consumer confidence, leading to people being more likely to borrow money against their property. But it predicts house price inflation will be more subdued going forward, putting a break on secured lending as the equity in people's homes does not grow at the rate they have become used to. Datamonitor said mainstream lenders were becoming increasingly involved in the secured loan market, which had previously been dominated by firms specialising in lending money to the so-called sub-prime market, such as people with impaired credit histories. But it said if mainstream lenders were to be successful they needed to revamp the image of secured loans, presenting them as a solution for all types of homeowner. This should replace their current image of a product for people who were struggling with debt and would have problems borrowing the money elsewhere. Edited September 16, 2005 by Catch22 Quote Link to comment Share on other sites More sharing options...
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