Banks provide fresh evidence of booming property market
There were renewed signs of booming confidence in the UK property market yesterday, as Northern Rock reported record mortgage lending in the first quarter of the year and Yorkshire Bank warned homebuyers to beware the return of gazumping.
Northern Rock's total gross mortgage lending was up 35 per cent year-on-year in the first three months of the year, with net residential lending up by some 55 per cent. In the current quarter the pipeline of uncompleted loan applications is up 50 per cent on the same time last year, at £3.3bn.
Adam Applegarth, the chief executive, said the performance was in line with the group's target of gaining a home loans market share exceeding 7 per cent this year, about twice its share of existing loans.
"Affordability remains at sustainable levels given the UK economy as a whole. The housing market remains robust," he said. "In the medium term, signs of a modestly slowing economy may have an impact of housing demand, but this should be offset by a combination of a shortage of new housing and historically low interest rates."
The strong figures come in the wake of upward revisions to expectations for house price growth this year. Nationwide last week reported property inflation running at 16 per cent year-on-year, and upped its forecast for 2002 as a whole to 10 per cent.
Yorkshire Bank yesterday warned that homebuyers in Yorkshire, Devon and Cornwall had become most likely to gazump amid mounting confidence that house prices would continue to rise.
Adults in the south west are most optimistic about the value of homes rising during this year. By contrast, 10 per cent of homeowners in East Anglia expected prices to fall.
Overall, 61 per cent of homeowners expected to see prices rise, while only 3 per cent predicted a dip. Among the factors feeding confidence was the hope that the thresholds for higher stamp duty are to increase in the Budget.
There was an increasing tendency to offer, or go to, the asking price. More than 10 per cent of homeseekers would immediately offer the full price while some 7 per cent were willing to go in higher first time to be sure of bagging their preferred home.
Subscribe to Independent Premium to bookmark this article
Want to bookmark your favourite articles and stories to read or reference later? Start your Independent Premium subscription today.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies