Fewer loans from lenders in January

Gross mortgage lending has decline in January continuing the sluggish trend from the last few months.

The value of loans advanced during the month is estimated at £14.3 billion, the Council of Mortgage Lenders announced today.

This is a decline of 14 per cent compared to December 2014 and by 11 per cent in comparison to January of last year.

The importance of the figures from the first few weeks of the year should not be exaggerated. While the somewhat muted activity on the mortgage market in the second half of 2014 has set a downward trend which continued into 2015 there are signs of a future improvement, according to the CML.

House purchase approvals reached 60,000 in December and negative seasonal effects are gradually falling away. The outlook for the next few months is favourable as inflation remains low, the real wages are high and the positive impact of stamp duty reforms is bound to kick in.

The CML expects lower house price growth in 2015 as demand and supply are to balance out throughout the year.

The Council expects gross mortgage lending for the whole year to reach £222 billion.