CML report housing market is “moving sideways”

Mortgage lenders CML reports UK housing market is “moving sideways”, with latest figures showing a drop in borrowing.

Latest figures from the Council of Mortgage Lenders (CML) has reported a relatively large fall in demand for loans during April, saying that the housing market appears to be “moving sideways”.

There was an 11% drop on the figure for March, with mortgages worth £18.4Bn advanced during the month. However, monthly mortgage lending figures often change rapidly, and activity often drops in the Spring. Taking this into account, the CML said the amount borrowed last month was higher than the average over the past year, and was 4% higher than in April 2016.

Senior Economist for CML, Mohammad Jamei, said: “First-time buyers and remortgage customers appear to be buoying the market.

“Home movers are having less luck. Their activity has been subdued for some time now and the low number of movers means fewer properties for sale. This supply and demand imbalance will continue to underpin house price values, even as the rate of price rises slows.”

There are other factors are pointing to a slowdown in the housing market, with HM Revenue and Customs reporting a 22.5% drop in property transactions in April, compared to March.

An explanation for this could be the landlords rush to make purchases following the latest in a series of a tax changes.

The CML also report that for the first time since 1996, the number of first-time buyers taking out mortgages had overtaken the number of people moving house. But while the number of home mover and landlords taking out mortgages is falling, the number of first-time buyers is rising.

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