The latest mortgage lending statistics have been published by the Bank of England. The statistics show that new residential mortgage lending activity decreased in Q4 2017 from the previous quarter. In total, £69.1 billion of new residential loans were advanced to individuals during the quarter. This was a 2.5% decrease compared to the previous quarter, however, a 10.1% increase from the same quarter last year.
Commenting on the statistics Royal London’s Personal Finance Specialist Helen Morrissey said “The Bank of England has taken steps to keep a lid on so-called risky lending with affordability criteria coming into play. Despite this, today’s figures show that in Q4 2017 38.43% of loans issued on a joint income basis were done so at an income multiple of three times or more. This is up from 26.42% of such loans in Q4 2007.”
“While house price growth has outstripped wage growth in recent years it is important that people do not overstretch themselves as they try and get a foothold in the housing market. While such an amount may feel affordable right now couples need to consider how they would manage in the event of any increase in interest rates or if one partner lost their job and ensure appropriate safeguards are in place.”