During the early 2000s the average price of a house rose dramatically year on year. This price rise created a bubble that, when it burst, brought a lot more than just the house price tumbling down.
After almost two years of recession, the economy is finally beginning to recover (even if politicians continue to argue over exactly what that rate of recovery is), accordingly, house prices are once again on the rise and have jumped remarkably over the last year.
According to the Department for Communities and Local Government house prices in April were 10.1% higher than they were a year ago. The remarkable growth was the highest rate of growth since October 2007, when the market was already beginning to tail of.
That means that the average cost of a UK property is £207, 516, and continuing to rise; the market grew by 0.4% in April.
These figures would suggest that the housing market was recovering and that there was a greater amount of demand in the market than there was supply. Yet the Council of Mortgage Lending continues to report only modest lending figures for the year. The number of loan granted to home buyers actually fell by 9% in April to 40,000.
A lot of this is due to the seasonal effect of the Easter Holidays, when the market is traditionally slow, and as a sign of how much things are improving, the figure of April was still 15% than the same month the year before.
Whilst the recovery of the housing market is generally a good thing (it gives people more equity in their homes for a start) it does have the negative side effect of making it much more difficult for first-time buyers to enter the market and in fact the proportion of mortgages made to first-time buyers was just 35% of the total, the lowest figure since September 2007. Experts say that even though the banks are relaxing their lending a little, they are still requiring an average deposit of 25% which, given the average house price is roughly £50,000 and a lot for any first-time buyer.
Still, the overall news seems to be good, and with such low interest rates at the moment there are a lot of extremely competitive mortgages out there to be found. One bank offering particularly good rates on home loans is Santander, who it was recently announced were offering the lowest rate mortgage since records began. If you can afford to get onto the housing ladder and you need a good mortgage, Santander is a good place to look.