Cover
State of the nation
Gross mortgage lending declined to an estimated £9.2 billion in January - a 13% fall from £10.6 billion in December but a 5% rise from £ 8.8 billion in January 2010. There’s no doubt that times are still tough. Mortgage Introducer takes a snapshot of mortgage businesses around the UK
Gross mortgage lending declined to an estimated £9.2 billion in January, a 13% fall from £10.6 billion in December but a 5% rise from £ 8.8 billion in January 2010, the Council of Mortgage Lenders said last month. “UK banks face a significant funding
challenge over the next couple of years,” says CML economist Peter Charles. “In total, including funding supported by the public support schemes, around £400bn to £500bn of wholesale term debt is due to mature by the end of 2012. This implies that, even in the unlikely event of a marked upturn in mortgage demand, the level of activity in the mortgage market can be expected to remain constrained.”
Times are indeed Tough “As a greater degree of equilibrium is
24 mortgage introducer MARCH 2011
restored to financial markets, the availability of funding for mortgage lending should improve from current levels to support more normal levels of activity,” Charles went on to say. But, he adds: “The unprecedented expansion of wholesale funding, and hence mortgage lending, experienced in the mid 2000s is unlikely to return.” Until the questions about the
economy can be answered, we aren’t going to see mortgage lending pick up significantly. David Whittaker, managing director of
Mortgages For Business, sums up the mood of brokers nationwide. “Imploring lenders to lend more this
year will be as fruitful as asking Ed Balls to quieten down – it simply won’t happen,” he says. “Luckily, the buy-to- let market is showing improvement and
will go from strength-to-strength this year as landlords capitalise on flat house prices and rising rents; however, whether they will be able to keep up with demand remains to be seen.” So against this stormy backdrop,
Mortgage Introducer asks: How’s business for you?
by John Round, chief executive, First Complete
There appears to be some cautious optimism in the market at the moment. While it is generally accepted amongst advisers across the LSL Group that conditions are still tough, most advisers
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