Gross mortgage lending in the UK reached £13.4 billion in February, 9% down on both January and on last February, the latest figures from the Council of Mortgage Lenders show.
This is the lowest monthly estimate for gross mortgage lending since April 2013 when lending totalled £12.4 billion.
The weaker lending figures have not come as a surprise to the industry. ‘Seasonal factors tend to weigh on activity at the start of the year, but looking through these, the underlying picture appears to be stabilising,’ said CML chief economist Bob Pannell.
‘We expect lending to improve in the coming months, as employment and earnings continue to pick up and the impact of recent stamp duty reforms start to feed through,’ he added.
Peter Rollings, chief executive officer of Marsh & Parsons, believes that too much should not be read into the data as 2014 was an exceptional year and a formative one with major changes to the borrowing process.
He said that 2015 marks a return to more normal patterns of behaviour as the new affordability measures introduced last year become part of the normal market.
‘Lending is only just getting into its stride at the beginning of the year, and it’s also a much longer process from start to finish now, so we’ll see more approvals race through as the market heats up later in the spring,’ he pointed out.
‘Buyer finances emerge much healthier for going through a more rigorous obstacle course. First time buyers have great cause for celebration with the new Help to Buy ISAs, whittled down stamp duty, generous mortgage rates, and plenty of supply on the market. All the elements are at work to up the ante in the housing market in the coming months,’ he added.