Gross mortgage lending has decreased by three percent compared to July of 2009 dropping from £14b to £13.6b even though the Government has repeatedly demanded banks began to offer loans again.
The level increased by 5% in June however is still on path towards meeting the Council of Mortgage Lenders final goal of £140b in lending funds this year. Despite this fact, the overall lending funds will still be way below lending funds in 2007 which measured up to £362b.
CML economist, Paul Samter, stated that it is hard to see anything more than a slow market performing for the rest of the year and that it is highly likely that over the course of the rest of 2010 lower transaction numbers and overall lending will be seen compared to the end of the year in 2009. Samter also noted that there was a large pickup towards the end of the year as the buyers were attempting to move before the close of the first stamp duty holiday.
Mortgage brokers are also in agreement that it is hard for home buyers to navigate through the tough mortgage landscape.
Coreco mortgage broker, Andrew Montlake, stated that the small increase in mortgage activity that has been observed is only notable given it is against a small rate to begin with. He added that there has been an increase in the amount of educational materials available to borrowers and an increase in lenders entering the market again. However, the mortgage environment is still not close to its previous pre-recession ‘normal’ state.
Bank profit margins on the other hand have reached their highest record in two decades.
No related posts.
Related posts brought to you by Yet Another Related Posts Plugin.
This comes as no surprise. Although the UK is gradually recovering from the recent recession, confidence is still low and lending and successfully applying for a mortgage is still very difficult without serious financial backing.