The second charge mortgage market experienced significant growth for the third month in a row, reflecting a strong upward trend in the lending sector.
- In September 2024, new business volumes for second charge mortgages surged by 27% compared to the previous year, reaching 3,105 new agreements.
- Quarterly lending figures also showed a notable increase of 23% compared to the same period in 2023, demonstrating robust market performance.
- The value of second charge lending rose by an impressive 37% year-on-year, indicating growing financial activity in this sector.
- Lower interest rates have played a crucial role in boosting the second charge mortgage market, as confirmed by industry experts.
The second charge mortgage sector has demonstrated an impressive upward trend for the third month, continuing its streak of double-digit growth. This development is underscored by the substantial increase in new business volumes, which grew by 27% in September 2024 compared to the same month in the previous year, amassing 3,105 new agreements according to data from the Finance & Leasing Association (FLA).
Quarterly figures reveal that this growth is not isolated to a single month. The sector saw a 23% rise in lending during the third quarter of 2024 compared to the corresponding period in 2023. This consistency marks a significant achievement for the second charge lending market, highlighting its resilience and potential for further expansion.
In terms of monetary value, the sector has shown even more promising results. Second charge lending increased by 37% in September year-on-year, accompanied by a 31% rise on a quarterly basis and a 14% increase annually. Such figures indicate a vibrant and expanding market that is gaining momentum and trust among borrowers.
Fiona Hoyle, director of consumer and mortgage finance and inclusion at the FLA, has attributed this sustained growth to the prevailing lower interest rate environment. “The second charge mortgage market has reported a third consecutive month of double-digit new business growth by both value and volume,” she noted, signalling a positive outlook for the industry.
The purpose of these loans further illustrates the market dynamics. In September, 58.1% of the new agreements were intended for the consolidation of existing loans. Those aimed at home improvements and consolidation accounted for 23.3%, while agreements solely for home improvements were at 12.1%. This distribution highlights the diverse needs driving growth in the second charge lending sector.
The sustained growth in second charge lending indicates a robust market responding positively to favourable economic conditions.
