With the reduced availability of mortgage lending less in 2013 about 4 in 10 property purchases were completed by cash buyers. At the peak of the market with funding readily accessible only 2.5 in 10 were cash buyers.
This means the number of home purchases using a mortgage was around 6 in 10, indicating a significant change in market roles.
With interest rates still at an all time low savers are not getting the returns on money sat in the bank. These investors are looking for alternative investment vehicles such as property, bonds and shares.
A heavy proportion of the property purchases are being carried out in London where foreign investors are dumping millions of pounds into the UK property market. This is causing house prices to reach astronomical levels and effectively take the property activity in London out of the hands of the BOE who rely on mortgage rates to control spending.
It will be interesting to see how sustainable the market trend is in the South compared with average family purchases / investment property in the North.