4 Nov

Lenders 'more confident' about housing market

Lenders 'more confident' about housing market

The increase in the number of 85 per cent loan-to-value (LTV) mortgages available indicates that lenders are becoming more confident about the state of the housing market, one expert says.

Ben Wilkie, editor of What Mortgage commented: "I think lenders … don't think [the housing market] is going to fall down by much more – if at all – and the competition is starting to come back."

However, he said that while the rise in high LTV loans on offer is good news, it is still well below the level of lending 18 months ago.

Moneyfacts reported that the number of 85 per cent LTV mortgage deals available in October had increased from 189 to 226 - the highest number in more than a year.

Mr Wilkie also commented that it was encouraging to see some lenders offering rates of 90 per cent LTV products. He predicted that this will become a standard level of borrowing for first-time buyers.

According to research from the Council of Mortgage Lenders, the average LTV of a mortgage taken out by a first-time buyer was 75 per cent in August 2009, compared with 85 per cent a year earlier.
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