That would represent a £15bn increase from £245bn in 2016, but would still fall way short of 2007’s lending total of £357bn.
The Intermediary Mortgage Lenders Association expects gross mortgage lending to hit £260bn in 2017 after a 5.9% rise.
That would represent a £15bn increase from £245bn in 2016, but would still fall way short of 2007’s lending total of £357bn.
Peter Williams, IMLA’s executive director, said: “The mortgage market shook off uncertainty and turbulence to register another solid year in 2016, and IMLA predicts that the market is set to do the same again in 2017.
“There are many factors that have contributed to the continued strength of the mortgage market and are likely to support its growth over the rest the year.
“The market has been supported by high levels of public demand for housing from a variety of different customer profiles.
“Furthermore, low mortgage rates and relatively modest levels of inflation have instilled borrowers with confidence, and made them willing to take out loans for purchase.”
IMLA’s white paper, ‘The new normal – prospects for 2017’, predicted remortgage activity rising from £81.3bn in 2016 to £90bn in 2017, offsetting a fall in buy-to-let lending from £40.6bn to £38bn.
That would give remortgage lending a 35% share of the market.
Williams added: “Different segments of the mortgage market had contrasting years in 2016. The remortage market performed very well, with existing borrowers eager to take advantage of rising house prices and low rates by securing a new deal.
“However, with lenders increasingly encouraging product transfers, it will be interesting to see if the remortgage market maintains this momentum in the long-term.
“The buy-to-let market suffered under the changes introduced by the Cameron government, but ultimately demand for private rented accommodation means that lending volumes are likely to rise again in the future.
“While the changes have certainly made things more difficult for landlords, property remains an attractive and comparably stable investment, which will support long-term growth in the sector.”
