Gross mortgage lending will not increase significantly until 2015, the Association of Mortgage Intermediaries has warned.
In its latest Quarterly Economic Bulletin it predicts gross lending will not exceed £135bn in 2012, compared with £141bn in 2011, and says it is unlikely to rise in 2013 and 2014.
Robert Sinclair, director of AMI, says economic restraints will affect the market for a few years.
He adds: “Although gross mortgage lending jumped in Q1 due to first-time buyers rushing to complete house purchases ahead of the end of the Stamp Duty holiday in April, remortgaging remains subdued.
“There is little sign of energy returning to the bottom of the market, with few mortgage options available.We expect gross lending this year to be under £135bn despite the good start to the year. Due to lenders restructuring their balance sheets, this is now unlikely to increase significantly during 2013 and 2014.”
Sinclair also has concerns about the new 7% Stamp Duty for homes valued over £2m, which he says will hit large buy-to-let investors and property investment companies.