Credit costs for a range of mortgage types plunged yet again, according to Bank of England data, suggesting that the government and Bank ’s Funding for Lending Scheme (FLS) has driven funds back into the housing market.
The average two-year fixed rate mortgage with a 75 per cent loan to value (LTV) ratio dived to 3.1 per cent in the first month of the year, from 3.35 per cent in December, and 3.69 when FLS began in August.
And the average rate on a similar 90 per cent LTV offering plummeted even further, from 5.33 per cent in December to 4.73 per cent in January – having been as high as 5.93 per cent at the scheme’s inception back in August.
Separate data out this morning put mortgage approvals at a four-year high during the same month. Mortgage approvals rocketed up 17 per cent between the last month of 2012 and the first month of this year, according to Esurv’s mortgage monitor. This put them at 65,184 during January – the strongest month since February 2008, when the effects of the crunch were yet to kick in.
And these funds were finding their way to the subprime end of the market, Esurv said, with LTVs of 85 per cent or above shooting up 30 per cent in just a month.
Another set of numbers, this time from the Royal Institution of Chartered Surveyors (RICS) also pointed to a strengthening housing market.
Respondents to a RICS survey were exactly evenly split on the direction of prices during the three months to December – a boost from the nine per cent margin in favour of falls seen last month.
Prime London property did particularly well, according to a fourth release, this time from London Central Portfolio, with a 14.1 per cent jump in average prime central London prices, bringing them to £1.359,739.