Blog: EC mortgage directive demands 'creative and intense' lobbying

The publication of the European Directive on Responsible Mortgage Lending and Borrowing gives us the defining view of regulation of our mortgage market from a continental perspective.

We are now embroiled in a short period of consultation to be followed by an intense opportunity to influence the decisions of our EU Parliament in delivering the new regime.

This initiative will clearly influence the eventual outcome of the Mortgage Market Review, but will require us to be more creative and intense in our lobbying than at any point in our past. We will have to clarify the issues that present problems, ensure that we have clear desired outcomes and deliver detailed amendments for European Members of Parliament (MEPs) to enact.

This will be a very different process from discussing impending regulation with the FSA.

Meanwhile, April is the start of the country's austerity measures.

This will be the first month where "the middle" will truly be squeezed. Tax, allowance and benefit changes, some of which were announced over a year ago, will impact pay packets for the first time.

The local authority and government spending cuts also begin in earnest. This will now deliver a sustained increase in unemployment and our economic strategy is now wedded to sustained private sector economic growth.

April also sees the arrival of NEST on a voluntary basis pending compulsory enrolment in this new, government sponsored, pension scheme from April 2012.

This 3% compulsory contribution arrangement for those in work, but not already in a pension, will be the biggest change to pensions since the introduction of the state pension. Another item to be built into mortgage affordability.

As we move into the second quarter of the year, we will all be hoping for a significant increase in activity in estate agents and housing market activity.

Mortgage volumes in the first quarter have been disappointing, but many firms have reported a positive start to the year leading me to think that intermediary market share has been good.

Finally, the unfortunate events in Japan and the conflicts in North Africa are reducing world economic growth forecasts and impacting UK numbers. This makes UK base rate rises less likely in the first half of the year.

The budget acknowledged, without great concerns, inflation well over target. This makes early MPC action less likely.