UK Mortgage market weakens.
UK Mortgage market continues to weaken! (June 2008)
Latest figures show that the UK housing market continues to weaken; according to the Council for Mortgage Lenders (CML) the UK mortgage market today is still in a depressed state. However the rate of decline has slowed a little from those of recent months.
In April gross lending rose by eight per cent, reaching £26.1 billion. This was after two months of falling figures, down five per cent on April 2007. This compared with the figures for March 2008, which was 24 per cent down on March 2007, suggests a slight rise in confidence.
CML Director general Michael Coogan has said that monthly volumes of house purchase lending are lower than last year and are expected to continue weakening.
Remortgaging has continued to increase its share of the market and stands at 42 per cent of the market in April 2008. In April 2007 it was 38 per cent. A total of 83000 loans for remortgaging in April represent a 14 per cent rise in volume and 11 per cent rise in value since March.
%more%
Total number of loans for home purchase for this period have continued to fall and loans for home purchasing now represent just 30 per cent of the market as opposed to 44 per cent one year ago.
April house purchase loans totalled 50,700 with a total value of£7.7 billion, a nine and ten per cent rise in volume and value respectively since March.
Loans to first time buyers were up four per cent from March totalling 18,500 but this was still 36 per cent lower than April last year.
Loans to Home movers totalled 32,000. This is 38 percent lower than April last year but up 13 per cent on March.
Among borrowers managing to get a mortgage fixed rate lending is becoming more popular as borrowers seek certainty.
In April 59 percent of borrowers took out fixed rate products as opposed to 54 per cent in March
Mr Coogan said that the squeeze on mortgage funding has lead to many lenders tightening their lending criteria and this will make it more difficult for some borrowers to get a mortgage, but it will reduce risk in a slower market.