Mortgage sector due to continue suffering says CML
June 26, 2008
The Council of Mortgage Lenders has recently released a gloomy report with regards to the future of the housing market, and this is one of a number of recent reports from a range of industry groups that make for gloomy reading. Officials from the CML have said that house prices could fall by 7% or more over the remainder of this year, and that the mortgage lending sector faced little hope of recovery over the next year. The CML had predicted that house prices could rise by 1% over the course of this year originally, but since October has changed its prediction to a 7% fall.
In addition to these bleak predictions the Council of Mortgage Lenders has also predicted that by the end of this year the number of transactions in terms of house sales will fall by around 35% to around 770,000 sales, which is the lowest level since the 1970s. One industry body described the CML report as one of the gloomiest yet.
Lending levels for the months of March and April of this year for mortgage and remortgages fell by 16% compared to the same months of 2007, with lenders continuing to tighten up on their lending criteria. It is thought that net lending over the course of the year could fall by around £55 billion and the housing slump is set to continue well into 1009.
One official from the CML said: “Lending volumes will get worse before they get better.”
Officials have also been warning that the fall in house sales and mortgage lending will affect other industry areas, and this include the legal profession, estate agents, and even furniture retailers.
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