Mortgage market on the up
The UK mortgage market is in general recovery mode, new research has suggested.
A report from market analyst Datamonitor predicts that the sudden rise in 2005 will continue steadily through 2006 and 2007, before taking a sharp upturn in 2008.
Gross advances in the UK residential market are forecast to grow almost 13 per cent, from approximately £287 billion in 2005 to £324 billion in 2010.
However, mortgage lenders will also have to 'contend with the threat of increasing bad debts and costly regulation', warns Maya Imberg, financial services analyst at Datamonitor.
After a decade in decline, the number of cases of mortgages in arrears has increased, from 92,090 in 2004 to 105,990 in 2005, and the trend is set to continue.
'The worry is that should consumers start to buckle under the weight of their debts, bad debts could rise, hurting lenders overall,' Ms Imberg comments.
However, consumers can avert the threat of going into arrears by taking advantage of the increasing number of competitive mortgage deals likely to follow a market expansion.
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