The Bank of England’s Credit Conditions Survey reported that UK demand for secured credit for housing – mortgages – has grown at its fastest rate since 2007.
The survey, released on 8 January, showed that both lending and demand for credit has significantly risen in the three months to December.
Banks and building societies surveyed also reported an expected increase in the availability of secured credit to households, small businesses and large private non-financial corporations over the next three months (the first quarter of 2014).
Lending for unsecured credit to household and medium sized businesses has stayed steady despite a rise in demand for the latter.
Demand for secured credit for housing has grown at its fastest rate since the quarterly survey began in 2007.
Lender attributed the rise in mortgage credit availability was driven by market share objectives, higher expectations for house prices and increasing enthusiasm for risk.
There was also an increase in availability for borrowers with a loan to value ratio of over 75% which lenders attributed to either participation in the government’s Help to Buy Scheme or the increased competition associated with the scheme.
Lenders reported a combination of factors had driven demand for credit for business, including capital investment, inventory finance, commercial real estate, and, to a lesser extent, mergers and acquisitions and balance sheet restructuring had pushed up on demand.
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