photo credit: World Economic Forum
Mortgage lending in the UK is still on the slide, new figures suggest, as property companies wait for government aid to kick in.
Gross home finance approved in December dipped 11 per cent compared to November, and is at its lowest since April 2001.
The statistics from the Council of Mortgage Lenders also said lending totalled £256.4 billion in 2008, down 30 per cent on £363.7 billion in 2007.
The group said improvements in the availability of property finance were unlikely to be fully seen until the second half of this year.
Michael Coogan, CML director general, said:
“This week’s package of measures to support the financial system and invigorate new lending was an essential and welcome move by government.
“The next challenge is to settle the detailed requirements for each measure.”
Earlier this week the UK Treasury announced new measures for struggling banks, providing a long list of measures designed to free up finance and widen the mortgage market.
Although house prices have fallen, a bank-led tightening on all credit including home loan finance is thought to be holding back a market recovery.
As part of the Treasury package, the government will sell insurance to banks against a proportion of what they eventually lose from so called ‘toxic debts’.
Peter Bolton King, chief executive of the National Association of Estate Agents (NAEA) added the slump in property finance was “disappointing” but not unexpected.
Related posts:
