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Figures highlight rise in property lending

16-May-2015

Home lending rebounded last month as conditions improved for property buyers requiring smaller deposits, according to new findings. 
Data showed that higher LTV lending represented 16.9 per cent of last month's house purchase approvals, the largest proportion since September 2014.

In addition, there were 10,300 higher LTV loans, a 10.7 per cent month-on-month increase compared to January, according to e.surv.

Higher LTV approvals formed the largest proportion of total house purchase lending since September 2014 and as a result, the absolute number of higher LTV approvals has bounced back. 

The data showed that there were 10,298 higher LTV loans in February - 10.7 per cent more than 9,300 in January.

Speaking about the findings, Richard Sexton, director of e.surv chartered surveyors, said: "Lending to lower deposit borrowers is back on track, which is encouraging as the mortgage market moves into spring. Higher LTV borrowers took a nosedive in October as a proportion of the market after the introduction of loan to income caps became a challenge for first time buyers.

"But these buyers are evidently returning to the market to take advantage of low mortgage rates and cheaper stamp duty charges. And after the tricky bedding in phase that accompanied new mortgage legislation, first time buyers are now once again accessing a market restructured for long term viability."

The figures also showed that house purchase approvals grew 0.2 per cent month-on-month in February, with 60,935 approvals, compared to 60,786 in January and 60,349 in December. 
Property valuations rise

Separate figures published by Connells showed that valuations in the UK property market last month increased across all sectors with the total number 50 per cent higher than it was at the start of the year.

The Connells Survey and Valuation report found that first-time buyer activity reached an eight-month high in February with the sector posting the second-highest monthly growth after home movers.

Furthermore, the number of valuations rose by 52 per cent compared to the previous month.

House prices rise

There are also signs that now may be a good time to purchase a property, with house prices on the rise.

Research published by Your Move and Reeds Rains show that residential property prices in England and Wales are £34,000 above their pre-crisis high of February 2008.

This will undoubtedly spell good news for many first-time buyers who have managed to get on the property ladder, as it means their home will be worth more in the long-run.
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