AMI - Funding for mortgages to remain restricted

Funding for mortgages is to remain restricted over the next few months, it has been suggested.

The Association of Mortgage Intermediaries (AMI) has warned that limited funds will be available to landlords and potential house buyers until after the general election.

It follows the recent decision of the Bank of England's Monetary Policy Committee to maintain the interest rate at the current historic low of 0.5 per cent.

Commenting on the decision, Robert Sinclair, AMI director, said: "With the general election now imminent the MPC has, unsurprisingly, maintained its position. Economic recovery remains weak and we wait to see if further stimulus via quantitative easing is required.

"With inflation hopefully peaking and house prices reining back there is little evidence to support an increase to the interest rate."

However, independent mortgage adviser John Charcol has estimated that the market is set to "bounce back".

Ray Boulger, a spokesman for the firm, said: "All the figures we see indicate January was an aberration, almost certainly caused by the snow which naturally had a significant impact on prospective buyers' ability or willingness to look at properties. We expect to see a bounce back in February's approval and lending figures."

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