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February gross mortgage lending largely unchanged

18 Mar 11

February gross mortgage lending largely unchanged

Gross mortgage lending in February was an estimated £9.5 billion, according to new data published by the Council of Mortgage Lenders. This is almost identical to January’s gross lending figure of £9.475 billion and marginally (less than 1%) higher than the £9.419 billion in February 2010.

Although lending remains weak overall, stronger remortgage activity has continued into the early months of 2011. While there has been a seasonal pick-up in house purchase demand over recent weeks, this appears to be weaker than a year ago despite the fact that there was a lull at the start of 2010 following the expiry of the (earlier) stamp duty concession at the close of 2009.

Commenting on today’s gross lending figure, CML chief economist Bob Pannell said:

"There is little in the latest batch of market data that would cause us to revise our market forecasts for 2011, and nothing that alters our underlying view that this is going to be a challenging year for households and the housing market.

"The housing market remains stuck in a rut and, while we do not anticipate much relief in next week’s Budget, it does present an opportunity for the chancellor to address the reform of stamp duty. What we have instead is the introduction of a new 5% band. That is an irrelevance for the majority of home-buyers but another indication of the haphazard and arbitrary nature of this tax, where reform is long overdue."

The CML’s monthly market commentary is published today and provides further analysis on the UK mortgage market.

Notes to editors

1. The Council of Mortgage Lenders' members are banks, building societies and other lenders who together undertake around 94% of all residential mortgage lending in the UK. There are 11.4 million mortgages in the UK, with loans worth over £1.2 trillion.

2.  The Council of Mortgage Lenders does not publish statistics for mortgage approvals. The data in our monthly Regulated Mortgage Survey and gross lending press releases relate to mortgage advances only. A mortgage approval is the firm offer to a customer of a specific amount of credit secured against a particular property. A mortgage advance is the total amount of loan actually provided to the buyer, by the lender.

3.  Next month’s gross lending press release and market commentary will be published on 20 April 2011.

 

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