The mortgage market is starting to recover and climb back out of the dip it found itself in after reforms to the regulations last year, it has been claimed by the Council of Mortgage Lenders (CML).
The CML said that in the course of the last year, we have seen the market fall rather significantly after new rules came into play last April that meant lenders had to be more stringent with lending conditions, taking into account all the spending habits of an applicant rather than just income. This, of course, saw the number of approvals fall, as those who would have previously been given the green light to buy were increasingly turned away.
However, the market has been starting to climb out of the dip in the last few months, with approvals starting to pick up again in recent times. The CML report for April showed a four per cent decline year-on-year in approvals, but this is to be expected following the change that came into play last year.
And even the one per cent fall from March to April this year in terms of the number of approvals is no bad thing, the CML claimed, with the drop coming as a result of a stronger March as opposed to any sort of significant fall last month.
Mohammad Jamei, CML economist, said that the £16 billion of lending in April was rather indicative of a market in the throes of an 'incipient recovery'.
"Overall, we now seem to be on the cusp of a modest lending recovery. Household finances are generally improving as earnings growth continues to outstrip inflation, and mortgages are being offered at extremely competitive rates. As a result, we expect to see stronger lending in future months," he said.
And in the next few months, it is likely that the market will continue to improve, especially with the return of the Conservative party to Downing Street being hailed as a strong point for the British property market in particular.