Comment on today’s Bank of England Money & Credit stats.
“Despite predictions of doom and gloom the housing market once again performed strongly with net borrowing in July only decreasing slightly from June and still £1 billion above the pre pandemic average.
“With winter just around the corner the reality of higher energy costs will be coming sharply into focus very soon and household budgets will need to be adjusted accordingly but with house prices showing tremendous resilience the immediate future of the housing market remains strong.
“Feedback from our brokers across the country reveals that remortgage activity is increasing with homeowners keen to secure a competitive rate before further rises but there is also a steady flow of new borrowers. This is born out in today’s statistics that reveal approvals for house purchases in July, an indicator of future borrowing increased to 63,800 in July, from 63,200 in June.
“Realism will be the watchword for prudent lending over the remainder of the year! Borrowers will need to have realistic borrowing expectations which, combined with professional advice from mortgage brokers will ensure they get the loan they want. Although the ‘effective’ interest rate on newly drawn mortgages increased by 18 basis points to 2.33% in July, mortgage rates are still relatively low in historic terms and, with sensible lending policies any sort of future housing crisis can be avoided.”
John Phillips, national operations director at Just Mortgages