FTBs could face tough times

19-Sep-2008

First-time buyers (FTBs) looking to get on to the property ladder could be facing tough times ahead.

New figures from the Council of Mortgage Lenders (CML) show that gross lending totalled £21.8 billion in August - a 12 per cent fall from July and a 36 per cent drop on August 2007.

According to the CML's director general Michael Coogan, the figures reflect uncertainty for lenders and consumers.

"Lenders are uncertain about future sources of funding and the cost of funding, while consumers are unsure about how much further and for how long house prices will continue to decline," he comments.

Howard Archer, chief UK economist at analysts Global Insight, adds that the fall in lending is due to an "ongoing toxic mix" of stretched buyer affordability and tight lending conditions.

The news is not all bad for FTBs however, as Mr Archer also states that house prices are expected to continue to fall in 2009 to £147,478 on the Halifax measure.

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