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First-time Buyers

Trade body predicts ‘gentle slowing’ of mortgage lending

Adam Williams
Written By:
Adam Williams
Posted:
Updated:
11/02/2015

Gross mortgage lending in August reached

The Council of Mortgage Lenders (CML) reported gross lending of £18.6bn during August, 13% higher than the same month in 2013.

However, this figure was 5% lower than the £19.7bn recorded in July with CML chief economist Bob Pannell expecting a ‘gentle slowing’ of the market in the coming months.

“The narrative of recovering house purchase and buy-to-let activity continued through August,” he said. “However, it is important to be aware that this picture is being flattered by strong seasonal factors through the summer period.

“A gentle slowing of lending activity may now be in prospect, as a result of the continuing impact of tighter lending rules and a softening of the London market.”

Henry Woodcock, principle mortgage consultant at IRESS, said: “While the traditional summer lull is expected, the impact of more stringent and onerous processes as a result of the MMR is still hampering the approvals process.

“However, in the long-run, we are unlikely to see a prolonged retreat in lending figures. Buyer demand has not evaporated, and lending to buyers with the smallest deposits is being supported by a combination of the Help to Buy scheme and improving product options at the higher LTV bracket. When you factor in the demand for buy-to-let finance to match the needs of a growing tenant population, mortgage lending has some way to go yet.”


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