“The latest figures from the Bank of England show us that the mortgage market continues to ride high on the back of strong applicant demand, driven by the stamp duty holiday and the consumer reengagement following the initial lockdown and market closure of 2020. While we can see a seasonal dip in mortgage applications (Hometrack saw reduced application activity in December and January), we remain optimistic that interest for mortgages still remains strong, in light of the 95% mortgage guarantee, the return of high LTV mortgages across the market, the successful roll out of vaccinations, and imminently the easing of lockdown restrictions.
“The market is unequivocally buoyant and we can see from Hometrack data that there are strong indications of committed demand, with mortgage applications continuing to rise. We expect the following months to see an increased rise in mortgage approvals as we have witnessed a 6% increase in mortgage applications in March, compared to September 2020, which was our peak in volumes over the past 12 months.
“Our data also shows us that mortgage applications are shifting towards larger, more expensive properties, and away from the typical first-time buyer, entry level properties, in line with a peak of net borrowing being the strongest since March 2016 albeit against slightly lower volumes. This indicates the ongoing homeowner demand for more space, which has shaped the Covid property market.
“The high volume of activity in the market, boosted in part by the stamp duty holiday extension, means that any concerns about an economic downturn impacting the market is receding, and the outlook for the market is less pessimistic.”