The mortgage market is set to enjoy a recovery in the coming years, according to a new report.
A study by Datamonitor claims that UK customers will take out £324 billion worth of mortgages by 2010, a rise of 13 per cent.
However, the market analysts predict that the industry will have to endure two more years of hard times before a rise occurs as repossessions, mortgage arrears and tougher regulations take their toll.
"Not only will mortgage lenders have to cope with a slow market for another two years, they will also have to contend with the threat of increasing bad debts and costly regulation," Maya Imberg, the author of the report.
Analysts are concerned that whilst new regulatory measures such as Basel II, the Treating Customers Fairly initiative and home information packs may help to improve the quality of service for customers, they only serve to hamper competition in the mortgage market.
Datamonitor said: "It will be consumers who end up suffering the consequences in the end in terms of higher rates".To read more Mortgage News, click here.
© Adfero Ltd