Mortgage Lending Up In January
There has been a glimmer of good news for those in the housing industry, as gross mortgage lending went up in January, according to figures from the Council for Mortgage Lenders (CML).
Lending increased to an estimated £26.5bn in January, an 11% increase on the £23.9bn figure for December. The figure was still lower than most other months of last year.
Despite the snippet of good news, the CML said that it was expecting lower lending volumes throughout 2008, driven mainly by remortgage loans.
January lending figures are usually lower than those for December, but the increase comes on the back of a very poor December for the housing market.
CML director general Michael Coogan said: "Gross lending held up well in January. However, there is considerable uncertainty in the housing market at the moment and we expect lending volumes to be lower in the coming months." His forecast is for remortgaging to be stronger than for new mortgages in the short term. He added: "Home buyers might be more inclined to transact if their moving costs were reduced and the government has the opportunity to address this by raising stamp duty thresholds and cutting the rates of stamp duty in next month's Budget."
Nearly all indicators recently have pointed to a downward trend in the housing market. The number of surveyors at the Royal Institution of Chartered Surveyors (RICS) reporting house price falls was up for the sixth month in a row in January; the Halifax and Nationwide house price surveys both showed falls in house price inflation.
The UK's biggest mortgage lender, the Halifax, said that annual house price inflation was 4.5% in January, down from the previous month's figure of 5.2%.
According to Nationwide figures the annual price growth rate dropped to 4.2% in January, which was the lowest rate since December 2005.