February 21, 2011 | Author

Author Alec Hanson

The Council of Mortgage Lenders (CML) figures have reported a large fall in mortgage lending in January, down 13% to £9.2 billion. The slight positive news is that this is still 5% above the lending of January 2010!

This small ray of hope represents the first year on year increase since August 2010, although confirms the lack of impetus to growth in the mortgage and housing markets.

Peter Charles, CML economist stated in their market commentary:

“The Bank of England’s Inflation Report this week noted that the UK banks face a significant funding challenge over the next couple of years”

“As a greater degree of equilibrium is restored to financial markets, the availability of funding for mortgage lending should improve from current levels to support more normal levels of activity. However, the unprecedented expansion of wholesale funding, and hence mortgage lending, experienced in the mid 2000s is unlikely to return.”

So in summary the lending from mortgage companies is likely remain limited for the foreseeable future but increase sufficiently to support normal levels, yet not those levels seen previously.

For more information visit: http://www.cml.org.uk/cml/media/press/2861

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