Mortgage lending falls 11% as houses for sale decrease

The number of houses on the UK market reached a record low in March
The number of houses on the UK market reached a record low in March

Mortgage lending fell back month-on-month in April as would-be home movers struggled to find suitable properties.

The Council of Mortgage Lenders (CML) said an estimated £18.4 billion-worth of home loans were handed out in April - down by 11% compared with March when loans totalling £20.7 billion were advanced.

April’s figure was still 4% higher compared with a year ago, when lending totalled £17.7 billion.

The National Association of Estate Agents (NAEA) recently reported that the number of homes on estate agents’ books dwindled to a record low in March, with around 10 house hunters for every available property.

The CML’s senior economist, Mohammad Jamei, said: “First-time buyers and re-mortgage customers appear to be buoying the market, as low mortgage rates are encouraging borrowers to re-mortgage and attractive government schemes are helping first-time buyers.

“We expect this trend to continue over the coming months.

“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.”