Mortgage demand to flatten in Q3

Demand for house purchase mortgages increased “significantly” in Q2 and will settle down for the proceeding three months, lenders have told the Bank of England.

Responding to the bank’s quarterly credit conditions survey, those who replied added that demand for prime lending and buy-to-let lending had also risen sharply over the past three months and would likewise stabilise over the coming quarter.

The lenders also reported that demand for secured remortgaging had fallen during Q2, but was expected to pick up slightly in Q3.

The availability of credit follows this pattern, having dipped slightly in the three months to June and being expected to rise until September.

The survey details a changing appetite for risk and market share objectives as being the main drivers of increased supply. Lenders also expect a slight loosening of wholesale funding conditions over the next quarter.

Coreco managing director Andrew Montlake comments: “If demand for house purchases remains unchanged given the potentially turbulent months ahead, then that will be a considerable achievement.

“We are at a pivotal point in the Brexit endgame and a no-deal Brexit is now looking far more likely …as we enter uncharted waters, the impact of a no-deal Brexit on demand for property is anyone’s guess.”

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