Decade-low mortgage growth forecast into 2024

7th November 2023 Consumer Lending | #mortgage lending

Mortgage lending is expected to record decade-low growth in 2023 and 2024, according to the latest EY ITEM Club Outlook for Financial Services, as mortgage rates reach their highest since 2008, economic growth remains subdued and weakening housing market sentiment drives down demand. Overall, mortgage loans in 2023 are expected to rise just 1.5% (net) and 2% (net)…

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Rents jump 5.7% as house prices hold steady

19th October 2023 Consumer Lending | #rent increase

Average UK house prices edged 0.2% higher to £291,000 in the year to August, but private rents jumped 5.7% in the 12 months to September, according to latest data from the Office for National Statistics (ONS).  London saw the biggest change in private rents over the last year, up 6.2%, the highest since records began in 2006.  Private rents lifted…

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Higher interest rates a positive and a negative for consumers

19th October 2023 Consumer Lending | #interest rates

The EY ITEM Club forecast presents a mixed picture for consumer spending, which is expected to benefit from several supports. Although pay growth is expected to ease, inflation should decline more quickly. Falling energy bills, easing food price inflation and weaker pipeline price pressures mean inflation is predicted to average 7.4% this year (down from…

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Quarter of young homeowners opt for 35-year mortgages

A quarter of young homeowners, aged 29 and under, have opted for repayment terms of at least 35 years to make their monthly mortgage payments more affordable, according to Experian. This is up from one in 10 in 2020, an increase of 150%.   The increased cost of borrowing means that many people will be nearing retirement…

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Over two fifths of advisers see increase in demand for interest only mortgages

2nd October 2023 Consumer Lending | #mortgages

With interest-only mortgages recently discussed as an appealing option for UK borrowers, over two fifths (44%) of mortgage advisers have seen an increase in enquiries about interest-only mortgages over the past year, according to new research from global research and insights agency Opinium. Additionally, similar research conducted from Opinium among consumers found that one in seven (15%)…

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Consumer credit borrowing increased by £1.3bn in August

2nd October 2023 Consumer Lending | #consumer credit

Latest Bank of England (BoE) data has shown that borrowing of consumer credit by individuals amounted to £1.6 billion in August, up from £1.3 billion in the previous month. Consumer credit growth rose to 7.6 percent in August 2023 with outstanding balances for consumer credit now standing at £217 billion. Net borrowing of mortgage debt by…

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Cost to borrow rises across credit cards and loans rises

The cost to borrow on credit cards and personal loan costs for new borrowing have jumped in recent months, according to analysis by Moneyfacts. Between the start of June and the start of September 2023 (Q3 2023), the average purchase APR (which includes card fees) rose to an all-time high of 31.8% APR, according to…

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Number of first-time buyers falls amid tougher housing market conditions

27th September 2023 Consumer Lending |

The number of first-time buyers fell 22% between January and August this year, compared to the same period in 2022, according to the latest Halifax First-Time Buyer Review.  First-time buyers still accounted for over half (53%) of all home loans agreed in the first eight months of this year, a similar proportion as during the…

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Bank of England pauses interest rate rises – consumer credit industry reaction

22nd September 2023 Consumer Lending |

The Bank of England has announced that it has held interest rates at 5.25%, pressing pause on rate hikes after rising relentlessly since December 2021. The news followed a surprise fall in inflation in August, despite rising oil prices, some weakness creeping into the jobs’ market, and the Federal Reserve in the US deciding to…

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Homeowners expect monthly payments to jump by £617 per month

20th September 2023 Consumer Lending | #mortgage rise

As interest rates continue to increase, mortgage borrowers expect their monthly payments to increase by an average of £617 according to new research by The Mortgage Lender (TML). TML’s recent research found that 80% of homeowners reported being concerned about the effect of rising rates, with 37% being extremely concerned and 43% being somewhat concerned.…

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FCA uncovers misleading later life mortgage promotions

15th September 2023 Consumer Lending | #later life mortgages

The Financial Conduct Authority (FCA) has forced lenders offering lifetime mortgages to withdraw or change over 400 misleading promotions. A market review by the regulator found that sales of these mortgages often did not meet expected standards. The review identified a number of bad practices, including companies promoting the benefits of their products without mentioning…

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76% of brokers unwilling to use a lender that withdraws products at short notice

13th September 2023 Consumer Lending | #broker lenders

Research by Castle Trust Bank has found that over 76% of brokers have said the level of notice a lender gave them regarding the withdrawal of a product would impact their willingness to consider using the lender again in the future. The research found that over 60% of brokers said they would be less willing…

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Consumer finance fell by 2% in July

12th September 2023 Consumer Lending | #consumer credit

New figures released by the Finance & Leasing Association (FLA) show that consumer finance new business fell in July 2023 by 2% compared with the same month in 2022. In the seven months to July 2023, new business remained 3% lower than in the same period in 2022. The retail store and online credit sector…

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