Mortgage market 'not as bad as first expected'

30-Nov-2007

The Bank of England has released figures showing that the number of mortgage approvals suffered a notable drop-off in October, but the Council of Mortgage Lenders (CML) has said that things could have been even worse.

The number of approvals for house purchase fell from 100,000 to 88,000 last month on a seasonally-adjusted basis, the figures have shown, but the CML has remained optimistic.

While a reduction in the number of first time buyers has undoubtedly had an effect on first time buyer mortgages, the CML has said that the situation is not as bleak as some have suggested.

"What we're seeing from the Bank of England's statement out today is a far less dramatic reduction in approvals than the preliminary surveys, such as the BBA [British Bankers Association], had shown," said CML head of member and external relations Sue Anderson.

"To that extent this is pretty good news. It shows that the level of lending is looking as if it is holding up to a greater degree than some of the pessimists have been expecting.

"Naturally there is a slow down and that reflects a mixture of what we've been expecting to happen at this point in the year anyway and the exacerbating factors of the slowdown in funding, but I think it is more robust than doomsters have been predicting and that's quite good news for the market," Ms Anderson added.

House prices fell by 0.8 per cent on the month in November, the latest index from Nationwide has revealed.


Bigger deposits leading to higher charges.

Long-term fixes 'will not help first time buyers'

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