September report shows August mortgage lending figures plummeted
November 21, 2008
A report that was released last month by the Council of Mortgage Lenders showed that the previous month saw mortgage lending figures plummet, reflecting the slump that the housing and mortgage markets have been experiencing. The value of mortgage lending for the months was just half of the value of mortgage lending for the same period the previous year. The figure for August was the lowest since 2005, and despite efforts by the government to boost mortgage lending liquidity in the mortgage sector does not seem to be easing.
Officials from the CML stated recently: : “Exceptionally low housing market turnover and lower than anticipated remortgaging activity will keep monthly lending subdued in the immediate future.”
There was a slight increase in mortgage lending levels for the month of September, another report has revealed, but there is still a wide gap between lending levels this year compared to lending levels for the same period last year.
There have been a number of factors that have affected mortgage lending levels over recent months. The number of applications being made to lenders has fallen, as many would be buyers cannot afford to take the plunge at present due to higher living costs and inflation, and others are wary about ongoing house price falls, and are therefore reluctant to take the plunge and take out a mortgage when the value of the property they buy could continue to fall.
Another factor for lower mortgage lending levels is the tighter credit conditions that have been put in place by lenders, with many lenders now being far more stringent about who they lend to and how much they will lend. Many of those that apply for a mortgage are unable to get the amount they want, and in some cases are unable to get the finance they need at all.
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