In September, second charge mortgage volumes increased notably, evidencing market shifts.
- September saw a 27% rise in second charge mortgage volumes, spotlighting sector growth.
- The total new business volume reached £149 million, marking significant annual growth.
- 3,105 new agreements were reported, underscoring an expanding market.
- FLA’s insights reveal consistent growth patterns, underpinned by low interest rates.
During September 2024, the second charge mortgage sector experienced a remarkable surge, with new business volumes climbing by 27%, as per data from the Finance & Leasing Association (FLA). This significant uptick reflects increasing confidence and activity within the sector.
Financially, the sector recorded a total value of £149 million for new businesses in September, showcasing an impressive 37% increase compared to the previous year. Such financial metrics highlight the sector’s robust growth and potential.
Further, the number of new agreements reached 3,105, representing a 27% increase from the same month in 2023. This rise in agreements signals a growing interest and engagement in second charge mortgages.
Fiona Hoyle, the FLA’s director of consumer and mortgage finance and inclusion, noted the consistent double-digit growth over three consecutive months, attributed partly to a favourable interest rate environment. Her statement emphasised, “The second charge mortgage market reported a third consecutive month of double-digit new business growth by both value and volume in September boosted by the lower interest rate environment.”
Examining the loans’ purposes, 58.1% of new agreements in September were aimed at consolidating existing loans. Additionally, 23.3% were used for a combination of home improvements and consolidating existing loans, while 12.1% were solely for home improvements. This distribution of purposes reflects the borrowers’ diverse financial strategies and needs.
The nine months leading to September 2024 saw a 16% increase in new business volumes compared to the same timeframe in 2023. This comparative analysis underscores a positive trajectory for the sector, indicating sustained growth and resilience.
The September increase in second charge mortgage volumes highlights a dynamic market responding well to economic conditions.
