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Total mortgage lending down again Total mortgage lending falls back
(about 1 hour later)
The total amount of mortgage lending fell again in April, the Council of Mortgage Lenders (CML) said. The total amount of mortgage lending fell back again in April, the Council of Mortgage Lenders (CML) said.
The amount lent by its members stood at £10.4bn, down from £11.4bn in March, and was 60% lower than in April 2008.The amount lent by its members stood at £10.4bn, down from £11.4bn in March, and was 60% lower than in April 2008.
The CML said the drop during last month was due to a seasonal factor, with Easter falling in April this year, rather than in March a year ago.The CML said the drop during last month was due to a seasonal factor, with Easter falling in April this year, rather than in March a year ago.
The lenders organisation played down recent suggestions that the housing market may be about to pick up.The lenders organisation played down recent suggestions that the housing market may be about to pick up.
"It's still too early to spot a clear pattern of recovery in the housing market as some commentators have suggested," said the CML's director general Michael Coogan."It's still too early to spot a clear pattern of recovery in the housing market as some commentators have suggested," said the CML's director general Michael Coogan.
"Activity remains weak, and we have said we will see volatility in monthly lending figures as we bounce along at the bottom of the market," he added."Activity remains weak, and we have said we will see volatility in monthly lending figures as we bounce along at the bottom of the market," he added.
Falling prices Sales flatten out?
Estate agents and surveyors have spotted a small upturn in sales and a continued rise in the number of prospective buyers making enquiries. Estate agents and surveyors say they have spotted a small upturn in sales and a continued rise in the number of prospective buyers making enquiries.
Previous official figures showed a jump in mortgage approvals in February, along with a subsequent jump in completed sales in March. The lag between a pickup in mortgage applications and approvals may be longer than normal Bank of England
But prices are still falling, according to surveys from lenders such as the Nationwide and the Halifax. But an apparent bounce in activity may have come to an end, with completed sales flattening out in the past two months.
And the key to a revival in the property market remains the availability of funds for lenders. Fresh figures from HM Revenue & Customs (HMRC) show that the number of properties sold in the UK during April was 58,000 - just the same as in March.
The March figure had been a 35% rise on the previous month, and had been in line with Bank of England data showing a jump in mortgage approvals the month before.
"Mortgage applications have risen in recent months and approvals for house purchase have edged higher, though remain close to historical lows," the Bank of England said in the May edition of its newly launched monthly publication Trends in Lending.
But it warned that any revival in interest from prospective buyers might take longer than usual to feed through into sales.
"Some lenders have said that difficulties in valuing properties in present market conditions can lead to delays in the mortgage valuation process, so that the lag between a pickup in mortgage applications and approvals may be longer than normal," the Bank's report said.
Prices
Despite the recent pick up in activity, house prices are still falling, according to surveys from lenders such as the Nationwide and the Halifax.
The key to a revival in the property market remains the availability of funds for lenders.
With the credit crunch still inhibiting the ability of banks to borrow and lend, severe rationing is still being applied to would-be mortgage borrowers.With the credit crunch still inhibiting the ability of banks to borrow and lend, severe rationing is still being applied to would-be mortgage borrowers.
About two-thirds of all mortgage deals currently on offer specify a downpayment of at least 25%, although there has been a slight relaxation by lenders recently.About two-thirds of all mortgage deals currently on offer specify a downpayment of at least 25%, although there has been a slight relaxation by lenders recently.
"Although some innovative new mortgage products have been launched recently, the fate of the property market is still very much in the hands of the lenders," said Andrew Montlake of mortgage brokers Coreco.