While mortgage lending in the UK is not exactly of Irish interest, it is worth looking at to see the challenges that our nearest neighbours face and in some ways to see if their lending data is reflective of our own.
Today the Financial Services Authority (FSA) today published its latest Mortgage Lending Data for the United Kingdom covering the period Q3 2012.
Key statistics for Q3 2012 are as follows:
·The total value of outstanding loans at the end of Q3 was £1,227bn, an increase of 0.3% on last quarter.
·New advances in the quarter amounted to £40bn, a 7% increase on Q2 but 9% below Q3 last year.
·The overall average interest rate on new advances increased from 3.78% last quarter to 3.89% in Q3. There was an increase in the rates for both variable rate lending and for fixed rate lending.
·New commitments totalled £36bn in the quarter, down 10% from last quarter and 14% lower than in the same quarter of last year.
·Lending for house purchase accounted for the highest proportion of new advances seen in this series, at 66%. This was up on both last quarter (62%) and on Q3 last year (60%). As a consequence, the proportion of advances for remortgages was the lowest ever at 27%. The figure for commitments for house purchase was also a series high at 66%.
·The proportion of new lending done at an LTV of more than 90% remained above 2% for the third successive quarter.
·New lending with a combination of high LTV and high income multiple showed a further small upward move, but remains low in historic terms at 1.4% of new lending.
·The proportion of loans to borrowers with an impaired credit history has remained at the same low level for three quarters in succession (0.3%).
·There were 35,900 new arrears cases in Q3. This was an increase of 4% on last quarter and of 3% on Q3 last year.
·Although the total number of accounts in arrears at the end of the quarter rose in Q3, up 2% to 303,200, this was 7% less than the 324,300 accounts in Q3 2011.
·The proportion of the residential loan book that is in arrears, and hence not fully performing, was little changed from last quarter, at 2.46% in Q3 compared to 2.45% in Q2.
·Arrears totalling £27m on 7,644 accounts were capitalised in Q3.
·The number of new possessions in the quarter fell by 2% to 8,521.