Gross mortgage lending down

Gross mortgage lending totalled an estimated £12 billion in September, say CML

Related topics:  Mortgages
Millie Dyson
20th October 2010
Mortgages
This is down 1% from £12.1 billion in August and down 7% from September 2009 (£12.9 billion). This is the lowest September total since 2000 (£10 billion). Gross lending in the third quarter of 2010 was an estimated £37.4 billion, a 9% increase from the second quarter and down 4% from the third quarter of last year.

CML director general Michael Coogan comments:

"Lending volumes do not seem likely to increase substantially towards the end of the year. Funding pressures on lenders remain, and the practical implications of government and public spending cuts are beginning to emerge, with a resulting impact on consumer confidence.

"Despite the pressures on government finances, today's comprehensive spending review is no time to make further cuts in state support for borrowers in difficulty. A concerted effort by borrowers, lenders, the government and money advice agencies has helped to keep mortgage arrears and possessions in check during the current economic downturn.

"These support measures help contain the wider costs of homelessness, and deliver wider benefits to the government. Now is not the time to weaken the existing safety net."

David Whittaker, managing director of Mortgages For Business, said:

“These figures are truly dire and a reflection of the caution felt ahead of today’s spending review. The CML must now bite the bullet and admit that gross lending for the year is likely to be £125 Bn. There is no point in continuing to skirt the issue.

"It’s been encouraging to see some lenders re-entering the market, but so much more needs to be done if the industry is to return to any semblance of health. The government has to take responsibility, it’s about to flood the rental market having cut social housing so it needs to encourage lenders and landlords to increase activity.

"With lending now as low as in 2000 and house prices around double the value, it doesn’t take a Nobel mathematician to work out that we can’t continue like this."
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