Mortgage market ‘will regroup’

Property buyers can look forward to a recovering mortgage market, according to an industry expert.

Peter O’Donovan, head of mortgages at Bestinvest, maintains the Bank of England will not allow lending rates to continue at their current pricing levels.

While conceding the market may not return to what it was at the start of the year, Mr O’Donovan insists it is in the Bank’s best interests to move quickly before consumer confidence evaporates further.

He commented: “It may not return to what it was six months ago but, once the liquidity has shifted back into the market and top rates return back towards where the base rate level is, then more companies will start to relax their [lending] criteria.”

First-time buyers are among those expected to benefit most from a healthier mortgage market as property prices continue to tumble.

Latest predictions from the Council of Mortgage Lenders (CML) forecast house prices to be around seven per cent lower at the end of the year than at the end of 2007.

© Adfero Ltd

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