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Mortgage lending equals series low
Thu, 08 Jan, 2009
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Mortgage lending equals series low
Mon, 1 Dec 2008, 10:50:00
A meagre 32,000 mortgages were approved in October, matching the worst figure since records began back in 1999.<br /><br />The Bank of England number was 1,000 lower than the previous month and the same as the figure for August as lenders continue to hoard cash and limit loans.<br /><br />There's been a 64% slump in approvals during the past 12 months, from 88,000 in October 2007, as the credit crunch takes its toll. Approvals were up at 114,000 in the middle of 2007.<br /><br />Last week's survey by the Nationwide revealed the central bank's 1.5% cut in interest rates to 3% helped slow the slide in UK house prices to just 0.4% in November, but they were still down 13.9% on an annual basis.<br /><br />Recent numbers from the British Banking Association (BBA) showed mortgage lending for new houses by the UK's biggest banks more than halved over the past year.<br /><br />The number of mortgages approved fell by 21,584 in October, a 52% drop from the previous year and down from 23,383 the previous month. The average value of these mortgages dropped 16.3% to £128,000.<br /><br />Today's report also had net lending down 69% to £459m from £1.49bn in September. Gross lending secured on homes sank to its lowest since 2002 at £17bn.<br /><br />"An extremely weak set of Bank of England mortgage approvals and lending data suggest that house prices still have a long way to fall," said Howard Archer, chief UK economist at IHS Global Insight.<br />
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