The Mortgage Finance Blog

Yesterday saw the announcement from the Office of National Statistics that the United Kingdom has, at last, pulled itself out of recession. However it has been noted in much of the media that these figures are provisional and could be revised up or down in the coming months.

Additionally, the news today reports that the International Monetary Fund (IMF) have painted a much rosier picture of the world wide economy than they did back in October last year. The IMF is predicting world economic growth to be 3.9% over the next 12 months and the UK’s growth to be 1.3% representing a 0.4% increase from the 0.9% previously forecast.

The UK is formally out of recession and all indications are for a slow but steady recovery during 2010. The recovery is likely to be symbolised by a cautious approach to spending by consumers which will reduce the likelihood of a bubble and secondary crash.

For mortgage borrowers, the outlook is one of a continued low base rate, with the current rate of 0.5% unlikely to increase during 2010. With the property market and swap rates stabilising 2010 should see mortgage lenders offering more competitive products at higher loan-to-values and better value fixed rates.