The Council of Mortgage Lenders has reported that gross mortgage lending in November was an estimated £11.1 billion, a 5% drop from £11.6 billion in October. Reflecting the distorted figures for lending towards the end of last year’s stamp duty concession, the November figure is 10% lower than the £12.3 billion advanced in November 2009. As the lowest November total since 2000 (£10.9 billion), this is the fifth consecutive month where gross mortgage lending has been at its weakest in its equivalent month for 10 years.
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."
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.”
Richard Sexton, director of e.surv chartered surveyors has said:
“Last month we noticed the first loosening of credit conditions in the mortgage market since before the general election – with more mortgages being approved for borrowers and on more generous loan-to-value ratios. November turned out to be a rare bright spot for the mortgage market and the effects of that has not been felt in the numbers put out by the CML yet. There were some very attractive products available to homebuyers and that stimulated a lot of demand from borrowers, both to buy homes and to remortgage. The market usually goes very quiet in December of course, so the next big test for the market will be in the new year. January is the month to watch.”
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