Housing market recovery IS here, insist lenders

Wednesday 23rd January 2013
Written by Rosalind Renshaw

Mortgage lenders are insistent that the housing market recovery is under way.

The Council of Mortgage Lenders says it “may be easy to overlook the recovery that has already quietly been under way”, with consumer sentiment having not yet caught up.

The CML gives ten reasons for its positive outlook, starting with a claim that last year there was the highest number of property transactions since the onset of the credit crunch.

Although the Land Registry data on transactions for 2012 will not be available for several weeks, the CML believes there were some 930,000 transactions. It has reached its figures using HMRC data and estimating December’s sales. However, according to the Land Registry's most up-todate data, there were just 588,835 property sales in England and Wales up until the end of November.

The CML also believes that the number of first-time buyers is at a post-crunch high, although accepting that the current market is not easy for first-timers. However, it says that the pre-crunch market was not easy for first-time buyers either, and that the UK has a decades-long backlog of not producing enough new homes.

The eight other reasons the CML gives for believing that the housing and mortgage markets are in recovery are:

    1.    The availability of 90%-plus LTV mortgages has more than doubled in the past two years

    2.    There is ‘much more’ lending at higher LTV levels

    3.    More first-time buyers are entering the market without assistance

    4.    Lenders expect to offer more high LTV mortgages this year

    5.    NewBuy – the controversial taxpayer-backed scheme whereby purchasers of new-build properties only are able to get 95% mortgages – is being extended

    6.    Lenders are innovating responsibly – the CML cites Lloyds lend-a-hand mortgage, Nationwide’s save-to-buy scheme and Barclays’ new Family Springboard mortgage

    7.    There is ‘constructive’ forward planning going on within the mortgage industry

    8.    The outside world is beginning to notice the improvement in lending conditions. The CML says that people are beginning to notice that lenders are open for business.

(11) Comments

Added by on 2013-01-25 12:36:32

"Slappy you are a sad, rude person, and so angry, get help. Feel very sorry for you."

Looks like Happy got a bit close to the mark with that comment about IO mortgages LOL
Added by property agent on 2013-01-25 12:07:55

What a load of tripe. The property market in the UK has many many many micro climates within it. London market is superb and has been since the 2007 'crash' yet properties north of Watford gap are taking months to sell and prices are still dropping in many northern counties. The sooner these 'experts' appreciate this, the better, then we may not be subjected to these bold, normally false statements by varying bodies. So the CML is estimating well over 300,000 completions in December. That's a little optomistic don't you think?
Added by Happy Chappy on 2013-01-25 10:30:07

To the last poster I am not angry or sad and i dont require help....there is no need to feel sorry for me ,however, If you find me rude i apologise.

Chris was trying to bait the HPc'ers, Please note i am not a hpc'er although i do believe housing affordability is terrible due to low wage inflation, high basic items price inflation and rapid house price inflation.

Now the thread further up confirms what i said it has been a miserable year for house sales, transactions do not equal sales and there is no recovery yet.

What are your thoughts on the topic?
Added by Slappy fool on 2013-01-25 09:47:07

Slappy you are a sad, rude person, and so angry, get help. Feel very sorry for you.
Added by Happy Chappy on 2013-01-23 17:09:17

Chris, there is not one post on here from a HPC'er

Did you read the comments or just the headline.
There is no recovery, it is quite possibly the worst year on record

A HPc'er may well say in reply, Go back to paying your IO mortgages, sitting on your lazy backside and hoping unearned house price inflation will pay for your pension.
Added by Chris Peacock on 2013-01-23 16:47:11

Light the blue touch paper and wait for the HPC doomsters to explode.
Just think of all those wasted hours sat in your mum and dads box room posting on various forums when you could have been working to save a deposit.
Added by Anonymous Coward on 2013-01-23 10:45:22

I am actually quite scared by this news.

First the CML can't add up at all - this is a trade body for mortgage lenders - no wonder we are completely in the sh*t... :-(

Second, my guess that 2012 was going to be a bad year looks to be right, although I hadn't guessed it was going to be a record low.

To beat 2009 we would need to complete 160 thousand odd transactions, which would be 3 times the monthly average for the rest of the year.

I think that by the end of Feb, when the next month's worth of figures escape from the Land Registry, we will see that 2012 smashed the previous low record by a stunning 17-20%.

Wow!
Added by Mr B. A. Baracus on 2013-01-23 10:26:41

Something is wrong with that story...here are the official residential property transaction figures direct from HMRC

1988 - highest ever year - 1,990,000 transactions
2009 - lowest ever year - 770,000 transactions

And 08/09/10/11 were all very similiar levels

There is no way there will be 930,000 transactions in 2012 if there were only 588,835 in the first 11 months plus it would be completely against the trend of activity that us agents saw in 08/09/10/11 and which still seems to be the case.

I think it's a bit of a 'spin' story...

Added by Richard Copus on 2013-01-23 09:32:54

The problem with statements emanating from building societies and banks is that they are notoriously unreliable and are usually blatantly slanted to their particular agendas at the time. Official statements from the CML are not much different. This is one case where you can trust an estate agent because only he/she knows exactly what is happening on the ground currently. There are definitely green shoots around, but they're not growing much in this snow!
Added by MJ on 2013-01-23 09:19:02

Land Registry issued their figures yesterday stating 588,835 property transactions for Jan-Nov 2012.....that will have to be one hell of a December to make up the difference!!
Added by Industry Observer on 2013-01-23 08:15:46

Oink Oink , flap flap

Deary me talk about desperation and wishful thinking

Every one of these points is either weak or flawed. For example CML transactions include remortgages, many of which last year started to be forced on borrowers by their lenders.

Perhaps someone should remind CML of this?

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