Publications

Publications image We produce analysis and research on the housing and mortgage markets for industry practitioners, policy makers and other key stakeholders. We publish detailed ad-hoc reports, as well regular articles and a fortnightly newsletter on current issues, CML news & views.

Ah, but it's cold outside.
22 December 2010
Virtually the only news story of the week has been the weather. Yet again, the UK fails to cope with snowfalls which would be considered modest in northern Europe and north-east America. While the disruption to Christmas sales will hit the retail sector hard, some industries (notably energy) will gain from increased demand arising from the cold. For most sectors of the economy, including financial services, the impact will be minimal. And there is the benefit to the whole of the country in that this year no one needs to dream of a White Christmas.
Little comfort in latest economic data
16 December 2010
There was little comfort for the government or the Bank of England in the latest data for the key economic variables of inflation and unemployment. While neither showed any particularly sharp movement, both continued to show an adverse trend which increases our concerns that the economy is set for a period of very sluggish growth in the first half of next year. Against this unpromising economic background, the housing and mortgage markets are unlikely to show any increase in activity from current very modest levels.
Little pressure for base rate to rise
08 December 2010
The strong pace of recovery in GDP in the past six months has tended to deflect attention from the extent to which the UK economy remains depressed. And attention on current high levels of consumer price inflation has obscured the fall in wage inflation. In the medium term, there is significant risk of the inflation rate falling markedly below target. Monetary policy is, therefore, likely to remain accommodative, with little pressure for an early increase in base rate.
Slow but steady recovery over the next five years
02 December 2010
The Office of Budget Responsibility (OBR) has published its latest projection of prospects for the UK economy over the next five years. In line with Mervyn King’s dictum that “after a financial crisis, the hangover lasts for a while”, these forecasts show an unexciting picture of slow, if steady, recovery with the household sector markedly more subdued than the economy as a whole. For the mortgage sector this implies that, after marked weakness in the short term, activity will show a modest but progressive strengthening.
Is the Irish problem contagious?
25 November 2010
The dominant financial story of the past week has been the bail-out of the Irish government by the EU and the IMF – a consequence of the parlous state of the Irish banking system following the collapse of both the residential and commercial property markets. Although a similar crisis in either the Portuguese or Spanish banking sectors seems unlikely at present, the potential risk of such an event will tend to increase caution within the wholesale money markets.
No surprises in latest economic data
18 November 2010
The latest data on inflation and unemployment show the UK economy tracking in line with the projections set out by the Bank of England in last week’s Inflation Report. There were no surprises in the latest mortgage and housing market data with lending remaining very flat and house prices showing the same modest downward drift seen over the past six months.
Outlook changeable. Brighter later.
11 November 2010
The Bank of England's latest quarterly Inflation Report presents a rather gloomy picture of the outlook for the UK economy next year but is comparatively optimistic about prospects thereafter. In the short term, the growth rate is expected to slow and the inflation rate is expected to remain above 3%. But, in the medium term, output growth should be above its long run average with the inflation rate held below the 2% target.
Mortgage market continues to tread water
04 November 2010
The Bank of England's September mortgage data underline the quiet nature of the current market. With funding pressures still in place and the prospect of a weakening in the pace of economic recovery in the first half of next year, there is no reason to expect much change in activity levels over the coming months.
You can't believe all you read in the papers
28 October 2010
Press headlines suggested not only that GDP growth in Q3 was unexpectedly strong but that this also implied that the recovery would progress smoothly through next year. But, as the Governor of the Bank of England reminded us only last week, “after a financial crisis, the hangover lasts for a while”. It seems likely that demand will hit a particularly weak spot in Q1 and forecasters have been revising downwards their estimates of GDP growth in 2011.
MPC split highlights uncertainty about medium term outlook
21 October 2010
Whilst the near-term outlook is one of weakness, the recovery in growth should gain pace next year. How strong that recovery proves is uncertain and much depends on the extent to which demand from the business sector sustains the economy in the absence of any stimulus from the public sector. At least the MPC has scope to loosen policy through renewing the quantitative easing programme in the event that the growth in private demand falls short of expectations.