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Great Value Deals Is Boosting Confidence In The Property Market

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ASSETZ PROPERTY NEWS SERVICE

Wed, 05 Oct 2005 12:44:30 BST

Re-mortgaging wave boosts property market

A wave of re-mortgaging inspired by increasing numbers of great value deals is boosting confidence in the property market, with figures from the British Bankers Association (BBA) showing that, for the first time in over a year, the level of overall mortgage borrowing has outstripped the level that it was at 12 months ago.

Total borrowing has grown to £16.8 billion, while unsecured debt has fallen away to half the figure it stood in the same period of 2004. The level of borrowing secured against house prices is now at it's highest since July 2004 as 69,145 borrowers pile into the market following August's rate cut.

Mortgage approvals have also shifted up a gear following a weak period in July, with net mortgage lending rising from £3.7 billion to £4.3 billion in August, compared to £4.6 billion in August 2004. The average sum borrowed was £130,500, down £2,200 on the previous month but up over £18,000 on the same period of 2004.

"Stronger re-mortgaging activity, representing 36 per cent of all approvals, suggests that borrowers are shopping around for better deals and that gross lending will hold up in the coming months," David Dooks, BBA director of statistics told This is Money.

"Structured personal loans and overdrafts were stronger than of late and there may well be some switching between different forms of borrowing. It is worth noting, however, that overall trend growth in consumer credit is less than half the level this time last year," he added.

In a further indication of consumer confidence, mortgage equity release began to creep up again through the second half of the year, the first time that equity release has risen since autumn 2003. Owners withdrew £8.7 billion from their homes in the three months to the end of June, up from £6.4 billion in the previous quarter.

Home owners are coming to believe that the housing market has bottomed out, said Howard Archer of Global Insight, predicting that equity release would continue to build in the coming months. The figure in the first quarter of the year represented on average 4.2 per cent of income, up from 3.1 per cent in the previous three months.

Levels of equity release shot up throughout 2002 and 2003 as consumers took advantage of the peak of the housing boom by releasing wealth to fund large purchases and consolidate debt.

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ASSETZ PROPERTY NEWS SERVICE

Wed, 05 Oct 2005 12:44:30 BST

Re-mortgaging wave boosts property market

A wave of re-mortgaging inspired by increasing numbers of great value deals is boosting confidence in the property market, with figures from the British Bankers Association (BBA) showing that, for the first time in over a year, the level of overall mortgage borrowing has outstripped the level that it was at 12 months ago.

Total borrowing has grown to £16.8 billion, while unsecured debt has fallen away to half the figure it stood in the same period of 2004. The level of borrowing secured against house prices is now at it's highest since July 2004 as 69,145 borrowers pile into the market following August's rate cut.

Mortgage approvals have also shifted up a gear following a weak period in July, with net mortgage lending rising from £3.7 billion to £4.3 billion in August, compared to £4.6 billion in August 2004. The average sum borrowed was £130,500, down £2,200 on the previous month but up over £18,000 on the same period of 2004.

"Stronger re-mortgaging activity, representing 36 per cent of all approvals, suggests that borrowers are shopping around for better deals and that gross lending will hold up in the coming months," David Dooks, BBA director of statistics told This is Money.

"Structured personal loans and overdrafts were stronger than of late and there may well be some switching between different forms of borrowing. It is worth noting, however, that overall trend growth in consumer credit is less than half the level this time last year," he added.

In a further indication of consumer confidence, mortgage equity release began to creep up again through the second half of the year, the first time that equity release has risen since autumn 2003. Owners withdrew £8.7 billion from their homes in the three months to the end of June, up from £6.4 billion in the previous quarter.

Home owners are coming to believe that the housing market has bottomed out, said Howard Archer of Global Insight, predicting that equity release would continue to build in the coming months. The figure in the first quarter of the year represented on average 4.2 per cent of income, up from 3.1 per cent in the previous three months.

Levels of equity release shot up throughout 2002 and 2003 as consumers took advantage of the peak of the housing boom by releasing wealth to fund large purchases and consolidate debt.

Without the FTBs, how big the wave could be?

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IMO and from experience part of any crash constitutes a dead cat bounce.

The false hope offered by a minimal .25% cut in IR and the ignorance of the masses who believe they are about to hit another gravy train will pre-emt the sobering reality that a lot of people in the country are spending a vast ampunt of money on little more then hot air.

http://news.bbc.co.uk/1/hi/business/4314754.stm

Nothing goes down in straight line not even Everest.

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I do keep hearing this "consolidate debt" everywhere.

Do some think this is good, sort of "oh well that's the debt out of the way, can spend some more now."

Weird.

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  • 335 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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