Second charge new business up 15% after six-month decline

Fiona Hoyle, Head of Consumer and Mortgage Finance at the FLA, said: “The second charge mortgage market has faced significant change since transferring into the FCA’s mortgage regime in March 2016. The strong performance in March 2017 – the first month that new business volumes have grown since August 2016 – could be the early signs of a return to form for this important market."

FLA figures had shown falling business volumes since August 2016, leading Fluent for Advisers to hit out at the 'negative attitude from some quarters about the prospects for the second charge market'.

Enterprise Finance added that although the second charge lending market grew just 4% in 2016 compared with 34% growth in 2015, the sector is seeing renewed optimism for 2017.

Its report concluded: "Many had predicted that a vote to leave the European Union would spark an immediate downturn in the housing market. Instead, what we have seen is a pause in activity for some investors as they monitored the situation. Given the better-than-expected performance of the wider UK economy in the months that have followed the EU Referendum and improved range and quality of products, we forecast that the second charge mortgage market will perform well in 2017."