CML provides assessment for housing market in 2011

| December 15, 2010 | 0 Comments
CML provides assessment for housing market in 2011

The Council of Mortgage Lenders (CML) is predicting that the housing market will remain subdued in 2011, due to uncertainty surrounding the economy and the ongoing mortgage rationing by lenders.

Over recent times, demand has been weak as many buyers have adopted a “wait and see” approach as uncertainty continues to surround the economy and the Government’s spending cuts make prospective buyers cautious.

However, the CML is hopeful that the £250,000 stamp duty exemption for first-time buyers may provide a modest boost to sales next year - particularly as the December 2011 deadline looms.

However, the fact remains that first-time buyers continue to struggle to get onto the property ladder as lenders are still demanding large deposits.

With regard to house prices, the CML expects them to fall modestly or stay flat next year as the availability of mortgages continues to “remain limited“.

The body does not expect lending levels experienced during the housing boom to return for many years.

Mortgage approvals are currently hovering around the 47,000 a month mark - this is less than half the level reached at the height of the housing boom in 2007.

In the meantime, the Council is predicting a modest rise in mortgage arrears and repossessions.

“We predict a modest increase in arrears and possessions next year, reflecting the continuing pressure on household finances, the persistence of cases of long-term arrears and the government’s decision to cut help for borrowers by cutting payments of support for mortgage interest,” it said.

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