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Mortgage lending 'fell 20% in April'

By Daniel Culpan

23 May2021

1p house Gross mortgage lending fell to an estimated 10.2 billion in April, marking a 19% drop from 12.6 billion in March, according to the Council of Mortgage Lenders (CML).

However, this figure reveals that mortgage lending was still 2% higher than the same time last year, when the total was 10 billion.

It appears that the slump in mortgage lending was in part due to homebuyers rushing through property purchases before the end of the stamp duty concession in March.

Furthermore, ongoing concerns about the possible effects of the eurozone crisis on the UK, along with signs that mortgage lenders are already tightening criteria and making obtaining credit more difficult for borrowers, add up to an uncertain future for the housing market.

CML chief economist Bob Pannell commented: "Mortgage lending activity has been relatively buoyant in recent months, with stronger lending for house purchase underpinning the more upbeat lending picture.

"The underlying picture is likely to be a bit stronger than the April figure suggests, because some first-time buyers are likely to have brought forward their transactions to March to take advantage of the stamp duty concession that was coming to an end.

"Eurozone developments are highly uncertain and have the potential to undermine UK economic prospects and conditions in our housing and mortgage markets. The underlying picture is likely to be one of easing momentum in the housing market, but with potential for a sharper downwards correction on bad eurozone news."

Image iStockPhotos / nejs

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Tags: mortgage, debt, CML, Council of Mortgage Lenders, home, eurozone crisis, first time buyers, property, home

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