Available mortgages decrease!
27 April 2008
Mortgages seem to be suffering the worst, as The British Bankers' Association (BBA) revealed that there were just 35,417 new mortgages approved for house purchases in March, 18% lower than in February. That was also 46% down on March last year and was the lowest monthly figure since September 1997.
David Dooks of the BBA said: “All forms of lending, not just mortgages, are being restricted by the lack of funds. The consequences of low banking sector liquidity show up clearly in March data; reduced product ranges and tighter criteria resulted in slower mortgage lending and significantly fewer loan approvals.
'Pressures on personal finances are also constraining demand, not only for mortgages, but also for personal loans and borrowing on cards.'
Simon Rubinsohn of the Royal Institution of Chartered Surveyors, added: 'The Bank of England's latest 'swap' arrangement with the banking sector should help provide a little more liquidity for lenders, but is not going to turnaround the current challenging environment overnight.
“If the mortgage market improves, lending is unlikely to be on the more generous terms that were being offered up to the end of last year, such as loans worth 100% or more of a property's value.
”As a result, minimum deposits of 10% are likely to become the norm for the foreseeable future, along with higher rates of interest for fixed and tracker-rate loans.
The total value of the mortgages approved for house purchase, which now make up just 27% of all new home loans being approved, was 44% lower than in March last year
|
|
