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BoE quarterly mortgage lending data

ended 13. December 2022

At 09:30, the Bank of England is publishing a report on the state of the mortgage market in the third quarter of 2023 (July to September). Few Qs:

  • How different has Q4 been compared to Q3 (after the mini-Budget)? Your chance to get poetic…
  • What were the main trends in the mortgage market in Q3, and what have they been in Q4 to date?
  • How's the mortgage market looking for 2023? A wasteland or will there be activity as prices fall and people swoop in for bargains? 

Any other thoughts, jot them down. 

7 responses from the Newspage community

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Samuel Mather-Holgate
Independent Financial Adviser at Mather and Murray Financial
If the mortgage market was a horror film, Q3 was the part when she’s tentatively walking through the kitchen whilst Q4 was when she was sprinting up the stairs. Lending has gradually dried up and over winter potential borrowers will hibernate and only reappear after the economy has come out of its big freeze, that might not be until early summer though. Q4 lending was mainly historic cases that were delayed, competing or remortgages by disgruntled borrowers from their original lending rates onto these Truss-induced, artificially high terms. Q4 was a shocker. Once the Bank of England realise they have inflicted unnecessary pain on homeowners by keeping rates too high for too long, the mortgage and housing market should improve. They will be forced to drop rates sharper and faster as the economy tanks and inflations falls out.
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Justin Moy
Managing Director at EHF Mortgages
The mortgage market for 2023 will see the number of home purchases, including first-time buyers, contract sharply, whilst the mainstream buyers adjust to the new normal for interest rates. This will also be caused by a shift by lenders to provide better rates to those remortgaging at lower Loan to Values (LTV) and/or Product Transfer, allowing their lending books to reflect a better level of risk and attracting 'lower hanging fruit'. We will need to see inflation drop, base rate peak, and some property price reductions before the buyers will resurface at levels we have seen over the past few years.
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Craig Fish
Director at Lodestone Mortgages
Anyone would think that a Tsunami had hit on September 23rd. Overnight, the mortgage changed forever. We have been inundated with enquiries, but for all the wrong reasons. People are worried and stressed about what the future holds because of the carnage caused by Truss and Kwarteng. They would have caused less damage if they had triggered the big red button. That said, I am expecting 2023 to be a positive year. It's been a long time since we have had to give good old-fashioned, fully personalised advice to clients, rather than just offering the cheapest fixed rate. This is going to be a good year for those brokers who have been around for some time. I never thought I'd be thanking Liz Truss for anything.
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Riz Malik
Independent Financial Adviser at R3 Wealth
There is no slowdown to Christmas at present and there is still business out there. We are desperately trying to make up for the lost two months and get new lending applications submitted before Santa leaves the North Pole to make his deliveries.
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Gary Boakes
Director at Verve Financial
Tracker rates in the fourth quarter to date become the talk of the town again as clients are clinging onto any hope of making their mortgage payments lower. Then the reality of the risk sets in and the majority decide on a 2-year fixed rate. The biggest change has been people's views on the market, Q3 everybody wanted to fix for the longevity and didn't want to take the risk, Q4 was met with what was uncomfortable interest rate rises and overnight everyone wanted to take the gamble and take a 2-year fixed rate in the hope it will be cheaper. It will be interesting to see who got it right or will people in 3 years be paying large ERCs to exit their rates. There will always be activity. Just as Covid gave us reasons and opportunities, falling prices will give opportunities to FTBs as long as lenders provide the products at higher LTVs.
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Rhys Schofield
Brand Director at Peak Mortgages and Protection
Bizarrely, December seems to have got busier as we go. This really doesn't feel like a crisis. The dust around rates seems to have settled. People still need mortgages whether they stay put or move home and based on estate agent listing activity, the market seems OK. The boom times of the past 2 years are over and in regards to activity we'll probably be looking at the more steady pre-Covid pace of 2019, which is hardly an implosion of the whole housing market.
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Amit Patel
Adviser at Trinity Finance
Truss and Kwarteng were the ghosts of Christmas past, present and future. Landlords up and down the country are still stressed about the stress rates being applied to their mortgages with no end in sight. Homeowners have been impacted by affordability issues and everyone has been hit by higher interest rates. I still expect rates to come down next year even if they go as high as 5% and to hover around 4%. Lastly, if I could ask Santa for two gifts this Christmas, it would be no more base rate increases and a general election.