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Buy-to-let lending continues to increase after a severe decline in the first half of 2009, new figures show.

While new lending rose for the second consecutive quarter in the last three months of 2009 – with 25,800 new loans in Q4 compared to Q3’s 23,700. These figures are well below thw historical average level and still very low. 

Michael Coogan, director general of the Council of Mortgage Lenders (CML), which produced the figures, said this was ‘below the level of activity which is needed to enhance a vibrant private rental sector in the UK’.

The BBC reported today that ‘The number of people who had their homes repossessed reached a 14-year high during 2009, figures have shown.’

The Council of Mortgage Lenders (CML) said 46,000 homes were repossessed last year, the highest number since 1995. That was an increase of 6,000 on the total for 2008, but was lower than the CML’s most recent forecast of 48,000. In December 2008 the CML had predicted 75,000 homes would be repossessed in 2009.

Lenders took 10,200 properties into possession in the fourth quarter of 2009 - 13% lower than in the third quarter. That was also a drop of 2% on the last three months of 2008.

Last year’s 46,000 repossessions were just 61% of the total recorded in the peak year of 1991, when lenders seized 75,500 homes.

The Bank of England has decided not to extend its quantitative easing programme at the moment but left the door open for future asset buying if needed, city wire reported today.

In a statement, the bank’s monetary policy committee said: ’The committee will continue to monitor the appropriate scale of the asset purchase programme and further purchases would be made should the outlook warrant them.’ But for now, members believe there are signs the economy is pulling out of recession and more stimulus is not needed.

see www.citywire.co.uk for the full report

Halifax stated that ‘House prices rose by 0.6% in January. This was the seventh successive monthly increase and takes the average price to 9.9% above its trough in April 2009. January’s rise, nonetheless, was more modest than in any of the previous six months.

Increased demand has combined with a low supply of properties available for sale to push up prices. There are some signs that more people are putting their homes on the market. A further increase in the supply of property is possible over the coming months, which would help to curb upward pressure on prices. Overall our current view is that house prices will be flat in 2010.’

The number of homebuyer mortgages approved by banks rose to a two-year high in December, but a continuing lack of remortgaging activity helped keep total lending down.

The figures from the British Bankers Association (BBA) showed 45,897 loans were approved for house purchases during the month, slightly more than double the number approved in December 2008. However, the number of remortgages dropped by 63.3% year-on-year to 23,480. This was mainly due to specialist lenders largely withdrawing from the market and building society finance contracting.

Over the whole of the year, the BBA said its members had approved a total of 980,000 home loans, the lowest figure since records began in 1997 and 27% lower than in 2008.

The Halifax House price index for Dec 2009 increased by 1.0 per cent in December, the sixth consecutive month of rises.  The monthly increase was slightly below the average for the preceding five months (1.2 per cent).

Martin Ellis, housing economist, said:”The prospects for the housing market this year will depend on how the UK economy evolves and whether there is a significant increase in the supply of properties for sale. Overall, our current view is that house prices will be flat during 2010.”

see http://www.lloydsbankinggroup.com/media1/research/halifax_hpi.asp for more information

Findaproperty.com rental index shows a 1.3% decrease in rent levels for the UK in December 2009, this is still 3% lower than a year ago. Supply levels are 1.7% higher than last month and an average property takes 56 days to rent.

See www.findaproperty.com for full information

Martin Ellis, Halifax housing economist, commented

“House prices increased by 1.4% in November. This was the fifth successive monthly rise with prices more than 4% higher over the first eleven months of the year.
Somewhat higher demand has combined with a low level of properties available for sale to push up prices. Further ahead, the prospects for the market will depend on how the UK economy evolves and whether there is a significant increase in the supply of properties for sale. Overall, our view is that house prices will be flat during 2010.”

See  www.lloydsbankinggroup.com for the full report

The number of loans for house purchase in the UK reached 55,000 in October 2009, its highest level since December 2007, according to new data released by the Council of Mortgage Lenders. The amount of buyers has risen from a low in January 2009 when only 23,000 loans were advanced. It is now up 140% from that low point. For the full story see the following link http://www.cml.org.uk/cml/media/press/2489

According to a recent report the interest rates on fixed rate mortgages have started to come back down again after hitting an eight year high in June of this year. Since hitting the almost decade long high, interest rates on fixed rate mortgages have come back down for the month of July according to recently released figures. (more…)