Market analysis reveals that mortgage lending has fallen by -28.6%, but may recover in Summer

Market analysis reveals that mortgage lending has fallen by -28.6% in the past year, but with summer approaching, seasonal housing market trends should bring a welcome boost to mortgage lending totals over the coming months.

The latest market analysis of gross mortgage lending data by CEO of Octane Capital Jonathan Samuels has shown changes to the ways money has been lent in the last two years.

The latest figures show that over the past 12 months mortgage lending in the UK came to an accumulated total of £217.7 billion. This marks an annual decline of -28.6% compared to figures from the previous 12 months when lending totalled £304.9 billion.

According to Octane Capital there are a number of contributing factors leading to the decline in mortgage lending over the past year, including the increased cost of borrowing due to heightened interest rates and the overall cost of living crisis, both of which have limited buyer purchasing power and, as a result, mortgage lending market activity.

Looking forward, Octane Capital suggest that ‘the past year’s housing market troubles could be finally lifting, with mortgage approval numbers increasing as a hold on interest rates has helped to steady the market’.

In addition, further analysis shows that historic seasonal housing market trends are likely to bring a welcome boost over the coming months. Analysis shows that, over the last five years, the summer season has seen mortgage lending totals increase by an average of 11.7% compared to the spring months. A summer boost has occurred every year over this five-year span, with the largest single bump coming in summer 2023 when mortgage lending totals rose by 24.6%. The figures suggest that while the market is showing strong signs of recovery at present, this biggest surge in mortgage market activity is yet to come in 2024.

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