Welsh lenders celebrate but mortgages will remain in the spotlight
Published: 20 May 2014 | Author: Bernard Clarke
Lenders in Wales were told at our annual lunch that while changes in the market over the last year may seem "almost seismic," the industry could look forward to the future with confidence.
Speaking at the annual lunch in Cardiff last Friday, CML Cymru chairman, Peter Hughes, of Principality Building Society, told guests that lending had grown, while arrears cases remained at consistently and encouragingly low levels. But he reminded lunch guests that political, economic and procedural changes were looming on the horizon, and that the onset of higher interest rates meant there could be no room for complacency.
He spoke favourably of the lending industry’s work with the Welsh government and cited Help to Buy Cymru as a project on which there had been "mutual determination to get it over the line." Feedback on the scheme had been universally positive, and the CML would continue to work collaboratively with the authorities in future.
CML chairman Stephen Noakes, of Lloyds Banking Group, spoke on the impact of rule changes emerging from the mortgage market review (MMR), and reminded lenders that the spotlight would be on the industry in the run-up to the election.
He described the Help to Buy equity loan scheme as "a welcome stimulus for the Welsh market." But, despite media interest, Help to Buy overall had accounted for only a small proportion of UK transactions. London may continue to distort the national outlook, but greater economic confidence and an improving house-building market were grounds for confidence.
The last 12 months had seen increased demand for lending for both house purchase and remortgaging, he said, but the market was not overheating.
In the coming year, the industry would assess the full impact of the MMR changes, but did not anticipate any significant disruption to the market. But in the run-up to the election, housing would remain centre stage, and any unintended consequences of the MMR could be magnified. The CML will, however, continue to work with lenders and the Financial Conduct Authority to see that any damaging effects were managed swiftly and correctly.