Positive outlook for the mortgage market

Published: April 30, 2008

A new survey shows that many mortgage lenders and intermediaries are confident about the future prospects of the housing and mortgage markets.

According to the report from the Intermediary Mortgages Lenders Association (IMLA), 46 per cent of lenders and intermediaries believe that house prices will rise or remain the same this year.

In addition, there is a growing feeling that the Bank of England will continue to cut the base rate of interest.

This is good news for borrowers and should lead to reduced mortgage interest rates in 2008.

According to the survey, the majority of respondents said that they think interest rates will be 4.75 per cent by the end of the year and the gap between the base rate and Libor is also expected to contract.

This is particularly important as a reduction in this gap will speed up the reduction of mortgage interest rates.