It is likely that there will be a further drop off in lending over the next couple of months as the Olympics and traditional summer lull come into play, although lenders are likely to return to the market with renewed vigour - and some competitive pricing - in the autumn as they make a final push for business in the run-up to the end of the year.
The good news for borrowers is that the mortgage price war is already well underway. Money market rates have fallen to their lowest levels ever in recent weeks and this is filtering through into pricing, with cheaper fixed rates being launched, including five-year fixed rates pegged at less than 3 per cent. For those who don't need the certainty of a fixed rate, there are some competitive base-rate trackers to choose from.
The cheapest rates remain available for those with sizeable deposits so we wait to see whether the Government's funding for lending scheme has an impact on higher loan-to-value deals with more choice available at competitive rates.