Mortgage lending down ten per cent in a year
Tuesday, 21 December 2010 12:00
Mortgage lending fell to its lowest level for November in ten years, according to the Council of Mortgage Lenders (CML). This is the fifth consecutive month where mortgage lending has been at its lowest level since the equivalent month in 2000.
The figures show that mortgage lending is down by ten per cent from one year ago. Lenders say that the low level of mortgage lending is likely to continue in 2011.
Part of the reason for such a sharp drop since November 2009 is because in November 2009 the relaxing in stamp duty was about to come to an end so many people had incentives to get a mortgage in that month before the chance to get a cheaper mortgage came to an end.
Bob Pannell, CML chief economist, commented:
"The fall in gross mortgage lending in November reflects the usual seasonal slowing of activity at this time of year, and reinforces the picture of a continuing flat market. Comparisons with the year earlier are somewhat distorted, as some households brought forward house purchase activity into the closing months of 2009 to take advantage of the stamp duty concession. But both demand for mortgage borrowing and the supply of funds for lending remain heavily constrained."
Looking ahead to 2011, the CML said that it expects there to be little encouragement for first-time buyers as they struggle to enter the market because of the rationing of home loans from lenders.
Bob Pannell said:
"The CML market forecasts published last week suggest that gross mortgage lending in 2011 is likely to remain at similar levels to this year. We estimate gross mortgage lending for next year will total around £135 billion."
Use Myfinances.co.uk's mortgage comparison tools to find the right mortgage for you.
Comments
Newsletter sign up