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Mortgage lending rises in March but down year-on-year
The Council of Mortgage Lenders estimates that total gross mortgage lending increased to £11.6bn in March, but fell against 2012 as March 2012 was when the Stamp Duty holiday expired.
This is 9% higher than February’s gross lending figure of £10.6bn but 8% lower than £12.6bn in March 2012.
Gross lending for the first quarter of 2013 was an estimated £33.8bn, said the CML.
CML chief economist Bob Pannell said: “Conditions in the housing and mortgage markets continue to show signs of improving. The improvement in funding markets over the past year, reinforced by the incremental benefits of the Funding for Lending Scheme, has been the key catalyst behind stronger housing activity.
“The Help to Buy mortgage guarantee scheme – while still embryonic as yet – holds significant firepower, and has the potential to increase activity from 2014.”
In his latest housing market commentary, Pannell also said purchase activity has remained relatively positive over recent months, particularly for first-time buyers.
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Chris Love, director of the independent mortgage broker Mortgage Simplicity, said: “The annual comparison was certainly distorted by the ending of the Stamp Duty holiday so the 8% retreat should be taken with a pinch of salt.
“However, the fact that the first quarter total looks set to be lower than the final quarter of last year underlines how the mortgage market remains volatile and uncertain.
“Consumers remain cautious and this caution will only have been compounded by stubbornly high inflation and the fact that unemployment is now rising again.
“With this in mind, all eyes will be on next week’s initial estimate of first quarter GDP.
“No mortgage scheme will ever be a substitute for a strong economy and a confident buyer.”