Lending hits two-year low in February
Thu 19 Mar 2015
Gross mortgage lending fell sharply in February to hit its lowest level for nearly two years.
At 13.4 billion it was 9% on January's 14.8 billion, and was also 9% lower year-on year, according to latest
figures from the Council of Mortgage Lenders (CML).
This is the lowest monthly estimate for gross mortgage lending since April 2013 when lending totalled 12.4
CML chief economist Bob Pannell said the drop was partly due to seasonal factors, and the underlying picture
appears to be stabilising. "We expect lending to improve in the coming months, as employment and earnings
continue to pick up and the impact of recent stamp duty reforms start to feed through."
Jonathan Harris, director of mortgage broker Anderson Harris, said uncertainty ahead of the general election is
forcing many buyers and vendors to take a 'wait and see' attitude.
"At least after May there will be certainty, and borrowers can make decisions fully armed with the facts."
Jeremy Duncombe, director, Legal & General Mortgage Club, said he still expected overall lending to pick up as
2015 progresses. "Stamp duty reduction, low inflation and low interest rates will continue to create good
conditions for lending to home buyers and remortgages."
He expects gross mortgage lending to reach 225 billion this year as more people look to move house, up from
205.6bn in 2014.
Richard Pike, sales and marketing director at Phoebus Software, said housing supply continues to hit lending.
"With many areas struggling to keep up with demand this may be part of the problem.
"It will be interesting to see if the Conservatives remain in power whether their housing zone plans and other
incentives boost home building enough to alleviate at least some of the housing supply dilemma."
Peter Rollings, chief executive of Marsh & Parsons, remained positive: "February's toned down lending levels are
certainly not going to set the world alight, but the embers of the mortgage market are still glowing brightly.
"Lending is only just getting into its stride at the beginning of the year, and it's also a much longer process from
start to finish now, so we'll see more approvals race through as the market heats up later in the spring."