Latest figures show mortgage lending has dropped again

Figures released by the Council of Mortgage Lenders (CML) indicate that mortgage lending has fallen back again and is 2% down on the April 09 figures, and 58% down against the May 08 figures.

These figures reflect both house purchase and remortgage, so if the housing market picks up this figure may not increase immediately as we have seen a drop in remortgaging due to the much tighter lending criteria and borrowers sticking with their current lenders.

An economist from CML Paul Samter said:  “While recent signs from the housing market have been more encouraging, we do not anticipate a significant recovery in activity in the coming months. Lending volumes appear to have stabilised at extremely low levels, but the weak labour market and lenders’ limited access to funding will constrain activity for some time yet.”

“Underneath the headline gross lending figure, it’s likely that a moderate improvement in house purchase lending in May has been offset by very low remortgaging volumes as borrowers stay with existing deals.”

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