According to the Council of Mortgage Lenders (CML), the mortgage market is heading towards a “plateau” over the coming two years, as house buyers are cautious about further borrowing.
The 2017 forecast from CML has been downgraded, as the organisation has become “more pessimistic” than it was one year ago. The gross lending forecast for 2017 has been reduced to £248bn from its previous £261bn.
The report particularly focuses on buy-to-let, as it predicts that borrowing in this area will reduce during the next two years. However, the figures for the current year indicate that gross lending for the 12-month period to November, has risen by 3%.
The director general of CML, Paul Smee, said that although the mortgage market will stay strong, it is likely to remain static rather than grow over the next two years. However, Smee doesn’t expect property prices to drop, although the number of transactions may fall. He added that although the mortgage market was sheltered from the effects of Brexit, the general economic uncertainty may have an impact.
CML remained cautious about the buy-to-let market, saying that it believed that 2015 had been the best year for the industry, while it expected the following three years to decline. The CML placed the blame on regulation changes and the new Stamp Duty Land Tax regime.
Anyone who is considering buying a home in the next two years would benefit from professional advice, ensuring that they opt for an affordable mortgage. CeMAP qualified advisers are able to offer information to buyers.