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Market suffers new setback as lending stalls; HOUSING.

Hopes that the housing market might be struggling back to life received a setback yesterday with news that the tentative pick-up in mortgage lending in March had petered out last month.

The total lent to home-buyers dropped by almost pounds 1 billion to pounds 10.4 billion - down from pounds 26.1 billion in April last year.

The Council of Mortgage Lenders attributed part of drop to the timing of

Easter but the combined total for March and April together was still 57 per cent down year on year.

"It is still too early to spot a clear patter of recovery in the housing market as some commentators have suggested," said Michael Coogan, the CML's director general.

"Activity remains weak and we have said we will see volatility in monthly lending figures as we bounce along at the bottom of the market.

"Our forecast for gross lending of pounds 145 billion in 2009 remains unchanged." Howard Archer, UK economist at IHS Global Insight, said "The CML data reinforce our belief that, while housing market activity has highly likely passed its low point, the pick-up will be gradual and fitful for some time to come given on-going very poor economic fundamental and still tight credit conditions.

"Consequently, house prices look likely to fall significantly further, although we do expect the rate of decline to progressively moderate."
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Publication:The Birmingham Post (England)
Date:May 22, 2009
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