Tough times face the housing market with mortgage rationing set to continue, said Michael Coogan, director general of the Council of Mortgage Lenders.
Speaking at the same Live lunch as Michael Portillo, Coogan said that transaction levels this year would not rise above those of 2009.
He said first-time buyers would remain scarce “because the bank of Mum and Dad has died”.
Coogan also revealed how the recession has hit his own organisation. “We have lost one-third in membership and 20% of staff. These are nothing like the good old days,” he said.
He warned his select audience of 24 people, who included agents from as far afield as Manchester, Newcastle and Kent, to “get the business in when you can”.
He said there had been a good start to the year: “But it is not coming on in the way we had hoped.” Confidence would remain a problem, and the election and World Cup would both put brakes on the housing market.
He did not forecast a change in interest rates this year, but predicted that from 2011 the banks would need to encourage people to “start hoarding money again”.
Coogan said mortgages would continue to be rationed, and that when a sub-prime lender ventured back into the mortgage market, they would be charging interest at credit card rates.
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