The Council of Mortgage Lenders has warned that lenders face "conflicting pressures" from the government.
Government measures to improve the mortgage market have been criticised by the Council of Mortgage Lenders (CML).
The CML's director general Michael Coogan warned that lenders face "conflicting pressures" such as being told to lower borrowing rates while keeping savings rates high. They were to do this while still "[ensuring] their long-term financial stability" to make sure they could aid the economy when it begins to grow again, he added.
His comments followed CML figures which revealed that October saw 39,900 home purchase loans, up by 14 percent from September but down 52 percent annually. Separate government figures revealed that prices dropped by 2.5 percent during the same month.
This continued slump in the market led to the government's initiatives, but Mr Coogan dismissed them as "conflicting and incoherent". He continued: "The government needs to decide on its key priority. The tug of war with lenders being pulled in every direction at once needs to end."
However, a Treasury spokesman argued that the government's objectives were "clear", namely keeping lending at last year's levels while maintaining financial stability. He added: "While it's important banks are given flexibility to rebuild their capital position, we also need to see a resumption of lending across all banks."
