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House prices and mortgage lending heading for next housing bubble

Bank of England figures show mortgage approvals increased to 60,624 the highest level since March 2008.

The level of approvals are up from the previous month of 58,238 with lenders advancing £16.6 billion compared to £15 billion and these figures are 30% higher than July last year.

Confidence is higher with buy-to-let landlords as interest rates are low and first time buyers unable to find a large enough deposit to become homeowners fuelling the rental market.

Nationwide have said the average house price is now £170,514 an increase of £8,000 on January this year.

One advantage of rising house prices for homeowners is remortgage buyers can now release capital for home improvements such as adding a new kitchen or bathroom.

Figures below pre-crisis levels

Compared to the height of the market in 2006 and 2007 of £25 billion the mortgage advance is still 33% lower according to the Council of Mortgage Lenders (CML).

The latest figures are still significantly below levels reached in 2007 when the average house price was £186,044 with mortgage approvals averaging 107,000 per month.

Even so, the figures released by CML have suggested increased demand is sending prices to record highs helped by the government’s Funding for Lending and Help to Buy schemes.

For older homeowners there is higher activity with equity release buyers accessing wealth in their property using a lifetime mortgage to help maintain their standard of living as costs rise.

Homes selling at asking price

Property website Zoopla monitors vendor discounts used to sell their properties and says the number of discounts offered have reduced from 37% to 32% of over the last year.

The amount of the discount offered also reduced from 7.6% to 6.3% with sellers in London the least likely to offer an incentive with only 23% reducing their price.

Demand from first timer buyers and home movers is increasing confidence in the market leading to fewer discounts from homeowners selling their property.

What are your next steps?

Call our LCM mortgage brokers for advice if you are a first time buyer, want to remortgage your existing home for the best mortgage deal, moving home or are a buy-to-let investor.

Learn more by using the property value tracker chart, mortgage cost calculator and equity release calculator. Start with a free mortgage quote or call us and we can take your details.

For equity release buyers our London City Mortgage advisers can recommend lifetime mortgages allowing you to receive cash from your property for home improvements, holidays or even pay for care at home.

Use your dashboard to access online mortgage quotes, money off vouchers and start your mortgage application online 24/7 on desktop, tablet or smartphone.

Mortgage Best Buys

These are examples of mortgage products we can approach with many more offering interest rates and flexibility to meet your needs.

1.16% Fixed Rate
60% Loan to Value
£1,525 App Fee
Until 01/11/2022
Reverts to 4.09%
1.19% Fixed Rate
60% Loan to Value
£999 App Fee
2-Years Time
Reverts to 3.59%
1.17% Fixed Rate
60% Loan to Value
£1,025 App Fee
Until 31/09/2022
Reverts to 3.59%
1.18% Fixed Rate
60% Loan to Value
£1,034 App Fee
Until 31/10/2022
Reverts to 3.59%

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Call for your free quote 0800 955 0058


    Equity Release may involve a Lifetime Mortgage or a Home Reversion Scheme. To understand the features and risks, please ask for a personalised illustration. Equity Release may affect your entitlement to means tested state benefits and will impact on the size of your estate. For Equity Release London City Mortgages charge a fixed fee upon completion of £695. For Mortgages a fixed fee is charged on application. Typically this is from £295 up to £495 for the services selected.


    Equity Release - Equity Released from your home will be secured against it. Mortgages – Your home may be repossessed if you do not keep up repayments on your mortgage or other loans secured against it. Think carefully before securing other debts against your home. The information contained in this website is subject to the UK regulatory regime and is therefore intended for consumers based in the UK.


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