The year 2021 will see a massive increase in mortgages.
It is the largest number of mortgages since the global financial crisis.
Around £ 87.7bn of mortgages were agreed for the coming months at the end of 2020, up 24.2% from a year earlier and the most since before the global financial crisis.
Home loans reached £ 76.6 billion in the fourth quarter, an increase of 4.2% year-on-year.
The share of mortgages with a low loan-to-value ratio decreased 4.5% in one year and was the lowest since it was first measured in 2007.
Figures come from Bank of England mortgage data for the fourth quarter of 2020.
The mortgage market boomed since the end of 2020.
Sarah Coles, a personal finance analyst at Hargreaves Lansdown, said: “The race for space has turned out to be more of a marathon than a sprint.”
“We have been buying mortgages at the fastest pace since the start of the financial crisis, and that was even before we knew the stamp duty holiday would be extended. However, not everyone is in this particular race, and some owners are completely exhausted.”
“The mortgage market was booming at the end of last year, and mortgages that were agreed for early 2021 were at their highest level in 14 years. This was even before the extension of the stamp duty holiday, which has likely brought more reluctant buyers into the fray.”
“But not everyone enjoys this boom. If you need a mortgage with a high-value loan, offers are scarcer than at any time since 2007. In this context, you can understand why the government decided to step in and offer guarantees for high LTV mortgages.”
Arrears are starting to grow, standing at 0.93% compared to 3.64% at the beginning of 2009.
The level of mortgages reached its maximum in the last 14 years.
Paul Stockwell, Commercial Director at Gatehouse Bank, said: “The value of new mortgage commitments has reached a 14-year high, driven in large part by homeowners aspiring to move into larger properties while under lockdown restrictions and they quickly capitalized on the tax incentive stamp when it was announced last summer.”
“Their activity meant that the annual growth rate of these new mortgage commitments almost quadrupled in the last quarter of 2020.”
“The stamp duty holiday extension announced in the Budget last week will help ensure that many of these mortgage deals are carried through to completion and gross mortgage advances in the first three months of 2021 are likely to be strong.”
“It is becoming apparent that the suspension of the foreclosure of the doorbell holidays will mean sustained high levels of mortgage activity through the summer as another busy home hunting season begins now that schools are reopening and the weather is improving.”
Jeremy Leaf, North London Realtor, and former RICS Residential Chairman says: “Although a bit dated, these comprehensive figures clearly illustrate the wave of transactions trying to take advantage of the stamp duty holiday, before its recent extension.”
“Since a hiatus in January and early February, speculations about moving the March 31 deadline, easing the lockdown, and the successful launch of vaccination, have resulted in the breaking of many predictions of a decline in the housing prices.”
“As a result, we are likely to see a market that is much more balanced between supply and demand, but fewer sales, like so many buyers and sellers, advanced their decision making.”
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