UK Housing Market Surges

UK MORTGAGE BORROWING in 2021 reached its highest level since modern records began.  The government’s 95% mortgage scheme, coupled with the Stamp Duty Holiday, saw mortgage lending soaring to the biggest net increase on record, according to the latest data from the Financial Conduct Authority. Home movers accounted for a record share of the mortgage lending. Some 42% of total mortgage lending went to this group, the highest level since comparable records began in 2007.

The UK housing market has been surging this year, with potential buyers competing for homes. This demand has not been matched by supply, which has led to rising prices.

Fastest price rises for a decade

Official figures show they have been increasing at their fastest rate for more than a decade, despite the coronavirus (COVID-19) pandemic.

Total gross mortgage lending in the first three months of the year was 26.5% higher. The data confirms that it is home movers who were being advanced an increasing proportion of home loans, whereas the share that went to owners who were remortgaging fell by 14% to its lowest level since 2007.

The share that went to buy-to-let property owners and first-time buyers was relatively unchanged. Part of the reason is the ‘race for space’ as home movers seek larger homes and properties with gardens as a result of a shift in working patterns.

For more information on the changing patterns of home ownership and increased sales values see our magazine on pages 46 & 47 plus 100 pages of articles on everything that you need to know.

The Mortgage & Property Magazine