Loan information numbers reveal stamp duty's influence on mortgages
The Council for Mortgage Lenders has released a new report which found that stamp duty created a rush to complete house buys.
A rush to secure mortgage deals before the end of the stamp duty holiday boosted lending in the last month of 2009, new loan information figures have revealed.According to the Council of Mortgage Lenders (CML), the number of loans to first-time buyers was at its highest for two years.
The CML found that there were 24,900 loans to first-time buyers in December, which is the highest figure since November 2007.
In addition, lending to first-time buyers was 26 per cent higher than in the preceding month.
Furthermore, it has been revealed that 55 per cent of house purchase loans were on properties costing lower than £175,000 and were, therefore, exempt from stamp duty.
Meanwhile, the CML has formally responded to the Treasury's consultation on whether to increase mortgage regulations.
The authority has endorsed the proposals to extend regulation to cover second-charge mortgages and to ensure that borrowers are protected when mortgage books are sold.
With regards to second-charge mortgages, the organisation campaigned over a period of time to have all secured lending regulated by the Financial Services Authority.
The CML has, however, rejected the plan to extend "conduct of business" regulation to buy-to-let lending and stated that the loans should not be governed by retail mortgage regulations.
A statement said: "Inappropriate regulation could further damage buy-to-let lending, which has shrunk substantially in the last two years, at a time when the government is separately promoting investment opportunities in the private rental sector."
In September 2008, the government announced that it was to stop stamp duty placed on houses worth under the £175,000 price mark for one year.
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