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Wednesday, February 20, 2008

The Perversity of The Housing Market

Despite the ongoing credit crunch, and the tightening of lending conditions and reduction in credit it seems that the housing market in the UK may be a little more resilient than some pundits have been claiming.

The Council for Mortgage Lenders (CML) reports that gross mortgage lending rose in January to £26.5BN, an increase of 11% compared to the £23.9BN in December.

However, this amount is still lower than most months in 2007.

The CML is expecting lower lending volumes over the course of 2008.

Michael Coogan, director general of the CML, is quoted:

"Gross lending held up well in January. However, there is considerable uncertainty in the housing market at the moment and we expect lending volumes to be lower in the coming months.

Home buyers might be more inclined to transact if their moving costs were reduced and the government has the opportunity to address this by raising stamp duty thresholds and cutting the rates of stamp duty in next month's Budget

A nice wish, but an unlikely reality.

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