Hope for housing market as mortgage lending soars

The Council of Mortgage Lenders (CML) has announced figures showing that mortgage lending was up 21% in March with £11.3bn being advanced, the highest figure since November.

The group said that the rise was due to more activity in the housing market, along with increased demand from existing homeowners, who were remortgaging to a new deal. However, in a note of caution it also said that the total lending of £11.3bn was slightly down on the £11.5bn that was lent in March last year.

The CML says that demand is likely to remain strong with the prospect of a rise in interest rates leading to people trying to remortgage off their lenders’ standard variable rates. Bob Pannell, chief economist at the CML said: “The housing market has emerged hesitantly from hibernation. Lenders expect mortgage credit availability to improve this quarter, and this should help to underpin house purchase activity, albeit at pretty low levels.”

The CML figures back up other data, released by the National Association of Estate Agents, which showed a big rise in the number of potential buyers, though agents are warning that too many of those hoping to sell are being over-optimistic and are pricing their properties too high.

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