Introduction
If you’re in the market for a mortgage, you may have heard of the Council of Mortgage Lenders (CML). This trade association represents the UK’s mortgage lending industry, providing data and analysis on the latest trends in the housing market. One of the key sources of information from the CML is its monthly mortgage lending figures. But what do these figures really mean for homebuyers?
What Are the CML Mortgage Lending Figures?
Each month, the CML releases data on the number and value of mortgages approved by its members. This includes figures for first-time buyers, home movers, and remortgages. The data is broken down by region and type of mortgage, and is widely regarded as a key indicator of the health of the housing market.
Why Are the CML Figures Important?
The CML figures provide a snapshot of the state of the housing market, and can be used to identify trends and patterns over time. For example, if the number of first-time buyers is increasing, this may suggest that more people are able to get on the property ladder. Alternatively, if the number of remortgages is rising, this may indicate that homeowners are looking to take advantage of lower interest rates.
What Do the Latest CML Figures Show?
The most recent CML figures, released in June 2021, showed that mortgage lending had increased by 78% compared to the previous year. This was largely due to the stamp duty holiday, which had encouraged more people to buy property. However, the CML also noted that there was a “sharp decline” in lending in April and May, as the holiday came to an end.
What Does This Mean for Homebuyers?
If you’re looking to buy a property, the latest CML figures may offer some insights into the current state of the market. The fact that lending has increased significantly may suggest that there is strong demand from buyers, which could push up house prices. However, the decline in lending in April and May may indicate that the market is starting to cool off.
What Factors Affect Mortgage Lending?
There are many factors that can influence the number and value of mortgages approved by lenders. These include:- Interest rates: Higher interest rates can make mortgages more expensive, and may discourage buyers from taking out loans.- Economic conditions: If the economy is struggling, lenders may be less willing to lend money, and buyers may be less confident about making big purchases.- Government policies: Initiatives like the stamp duty holiday can have a big impact on mortgage lending, as they can encourage more people to buy property.- Housing supply: If there are fewer properties available for sale, this can push up prices and make it harder for buyers to find affordable homes.
Should You Base Your Mortgage Decisions on the CML Figures?
While the CML figures can be an important source of information, it’s important to remember that they represent a snapshot of the market at a particular point in time. They should not be used as the sole basis for making important financial decisions like taking out a mortgage. Instead, it’s a good idea to speak to a mortgage advisor or do your own research to understand the wider context of the market.
Conclusion
The Council of Mortgage Lenders figures can offer valuable insights into the state of the UK housing market. They provide a snapshot of the number and value of mortgages approved by lenders each month, and can be used to identify trends and patterns over time. However, it’s important to remember that they are just one piece of the puzzle when it comes to making decisions about buying property and taking out a mortgage.