Bank of England: Value of outstanding mortgage balances with arrears 50.3% higher than a year earlier
The Bank of England has just published its Mortgage Lenders and Administrators Statistics: 2023 Q4 report, which showed the value of outstanding mortgage balances with arrears increased by 9.2% from the previous quarter, to £20.3 billion, and was 50.3% higher than a year earlier. The proportion of the total loan balances with arrears, relative to all outstanding mortgage balances, increased on the quarter from 1.12% to 1.23%, the highest since 2016 Q4. (other key findings below). Newspage asked brokers for their thoughts, bottom.
- The outstanding value of all residential mortgage loans decreased by 0.1% from the previous quarter to £1,657.6 billion, and was 1.1% lower than a year earlier
- The value of gross mortgage advances decreased by 13.4% from the previous quarter to £54.0 billion, and was 33.8% lower than a year earlier
- The value of new mortgage commitments (lending agreed to be advanced in the coming months) decreased by 6.6% from the previous quarter to £46.0 billion, and was 21.2% lower than a year earlier. If the onset of the Covid-19 pandemic is excluded, this was the lowest observed since 2013 Q1
- The proportion of lending to borrowers with a high loan to income (LTI) ratio decreased by 2.6pp from the previous quarter to 42.7%, and was 6.6pp lower than a year earlier
- The share of gross mortgage advances for house purchase for owner occupation increased by 1.0pp from the previous quarter to 58.7%, and was 3.3pp higher than a year earlier
- The share of gross advances for remortgages for owner occupation decreased by 0.8pp from the previous quarter to 29.7%, but was 2.3pp higher than a year earlier
- The share of gross mortgage advances for buy-to-let purposes (covering house purchase, remortgage and further advance) decreased by 0.5pp from the previous quarter to 7.0%, the lowest since 2010 Q3, and 4.9pp lower than a year earlier
- New arrears cases decreased by 2.6pp from the previous quarter, to 13.2% of the total outstanding balances with arrears, but remained 0.2pp higher than a year earlier
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