This article is from the source 'bbc' and was first published or seen on . It will not be checked again for changes.
You can find the current article at its original source at http://news.bbc.co.uk/go/rss/-/1/hi/business/7885398.stm
The article has changed 6 times. There is an RSS feed of changes available.
Version 0 | Version 1 |
---|---|
Mortgage lending at 34-year low | Mortgage lending at 34-year low |
(20 minutes later) | |
The number of mortgages lent to house buyers fell last year to its lowest level since 1974, the Council of Mortgage Lenders (CML) has said. | The number of mortgages lent to house buyers fell last year to its lowest level since 1974, the Council of Mortgage Lenders (CML) has said. |
There were just 516,000 mortgages granted to house buyers, down 49% from the level seen in 2007. | There were just 516,000 mortgages granted to house buyers, down 49% from the level seen in 2007. |
The squeeze on mortgage funds has seen widespread rationing by lenders, which meant that first-time buyers had to put down an average deposit of 22%. | The squeeze on mortgage funds has seen widespread rationing by lenders, which meant that first-time buyers had to put down an average deposit of 22%. |
The CML believes that lending is likely to fall even further this year. | The CML believes that lending is likely to fall even further this year. |
"The shortage of mortgage funding and reduction in the number of active lenders has reshaped the mortgage landscape in the space of a year," said Michael Coogan, the CML's director general. | "The shortage of mortgage funding and reduction in the number of active lenders has reshaped the mortgage landscape in the space of a year," said Michael Coogan, the CML's director general. |
"This low level of transactions is insufficient for the functioning of an efficient market," he added. | |
Action needed | |
The slump in lending and sales has been directly responsible for the sudden collapse of house prices seen since the credit crunch started in the summer of 2007. | |
Further action may still be necessary to increase transactions, stabilise prices and restore confidence Michael Coogan, Council of Mortgage Lenders | |
Last year the number of loans to first-time buyers fell by 46% to just 194,200, which was the lowest figure since the CML's records started in 1974. | |
The government has launched a number of initiatives to stimulate bank lending. | |
But Mr Coogan said more needed to be done. | |
"Measures are now in place to seek to restore the flow of funding to the mortgage market, but this will take time to feed through," he said. | |
"Further action may still be necessary to increase transactions, stabilise prices and restore confidence." |