Speaking at the Mortgage Business Expo in London, Baker said that the mortgage market had lost nearly a decade and a half of growth when taking inflation into account.
“We’re at mortgage lending of £11bn a month which is back to levels last seen in 1998/199. The market has gone back 14 years.
“We’re looking at £140bn of lending this year, next year it may be £150bn, but that is marginal improvement and not growth at the speed we want.”
He said that banks were currently being held back by the government’s increased capital requirements.
“The banking sector is not likely to have money to lend for some time. The government is tying banks’ feet together by forcing them to increase capital and that means they cannot lend.
“When banks are told they have to raise capital, that is bad news for the mortgage market.”
