Mortgage Lending falling Thursday, 18th February 2010

Data from the Council of Mortgage Lenders (CML) reveal that this is the lowest gross lending figure recorded since February 2000 (£7.9bn), with total amount of money advanced by UK mortgage lenders dropped by £9.1bn in January, a decrease of 32% from the £13.4bn lent in December and 21% lower than the figure for January 2009.

Forcing many buyers to rush their transactions through before the end of the year,there is usually a drop off between December and January, but this unusually large decline was attributed to the Stamp Duty holiday which expired at the end of December,

“We remain in a period of uncertainty for the housing market and economy at large. The market certainly improved over the second half of last year and started 2010 in better shape than most would have predicted 12 months ago. “More recent developments have been influenced by the end of the Stamp Duty holiday, and are likely to foreshadow a larger than usual seasonal drop off in activity in the early part of this year.
“However, the Bank of England is likely to keep rates low which should continue to mitigate mortgage payment problems and help cushion borrowers from the worst of the recession.” CML economist Paul Samter says.