CML Response to Chancellor's Measures

Yesterday, Chancellor Darling announced the Budget. The Council of Mortgage Lenders (CML) responded to the announcement and said that the modest measures are helpful, yet they are unlikely to have a significant impact on the housing market in the United Kingdom. The measures announced by the Chancellor include: - Introduction of the scheme that guarantees mortgage-backed securities - Maintenance of a rate of 6.08% at which ISMI is being paid to December 2009 - Extension of criteria for mortgage rescue - Introduction of a new £20 million scheme at the local level to provide families at the edge of homelessness with help - Extension of the £175,000 threshold for stamp duty till the end of the year of 2009 - Extension to the Home Direct scheme, which amounts to £80 million - Extension of ISA allowance (£7,200 to £10,200) Michael Coogan, director general of CML, commented on the measures as follows: the most important measure that will prove to have a positive income on the mortgage market in the long-term is the new scheme that guarantees mortgage-backed securities as it gives an opportunity to restart capital market funding for mortgages. Although the announced measures have little impact on UK housing market in the short-term, they at least provide some relief to the property sector. Overall, the measures are unlikely to improve the situation on the housing market in the coming months.