Home Owner Loan Market At Standstill
Despite some signs of slight improvement earlier this year, the home owner loan and mortgage market in the UK has struggled since the onset of the credit crunch, more than three years ago, but it now appears to have ground to a halt altogether.
New figures from the Council of Mortgage Lenders (CML) have shown that the amount of new lending on home owner loans has reached its lowest level since 2000 and the number of new loans being offered could continue to fall in the coming months.
During the month of October, the total amount of new loans stood at £12.4 billion, which was the same amount as the previous month, but a decrease of 9 per cent on the amount of new loans from twelve months earlier.
This is the lowest level of new lending on home owner loans for October for the past ten years, when the figure was just £9.9 billion in 2000, according to the CML.
The CML have also predicted that the total number of new loans is likely to continue to fall over the course of the coming months and it believes that this is to compensate for an increase in new home owner loan activity towards the end of last year, as many people took advantage of the stamp duty holiday.
Matthew Wyles of the CML said that he expected that the industry will end the year having offered around £137 billion worth of new home owner loans and that extra regulation and restrictions on new lending are largely to blame for the drop in loan numbers.
He said “As the CML has said on many occasions now, it is not the fact that conduct of business rules are being reformed that concern us. It is the layer upon layer of additional requirements that is making the overall regulatory edifice too big and unwieldy.”
