Mortgage lending down in January
17/03/2015
Mortgage lending dipped unexpectedly in January, according to a report from the The Council of Mortgage Lenders (CML).
Just 41,400 home loans were granted to home buyers in the UK in January. This was down 16% on January last year, and 26% on December. The number of home loans given to first time buyers was 19,000, which is the lowest monthly figure for 19 months.
The UK property market has continued to cool since last summer. This is due to tighter regulations around mortgage lending thanks to the Mortgage Market Review (MMR) and rapid rises in prices shutting some people out of the mortgage market altogether.
The CLM also showed that sales in November, December and January have fallen from last year. This may start to pick up again soon though, as figures from the Bank of England have shown that mortgage approvals for those months - the number of new loans approved but not yet lent - in fact started growing again slowly.
Mark Harris, chief executive of mortgage broker SPF Private Clients, says:
"January saw a bigger dip in lending compared with December than usual, which may partly be down to the flurry of activity at the end of last year to beat the stamp duty changes. Tougher rules introduced by the Mortgage Market Review (MMR) mean affordability is an issue for many borrowers, while more lenders may be offering higher loan-to-values, actually getting a big-enough mortgage can be more of a challenge, particularly in London and the south-east."
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