June 25, 2008
mortgages approvals fall to record low
The credit crunch continued to hit the housing market as the number of mortgage approvals, in May, fell to its lowest number since figures began to be recorded in 1997. The latest figures relect an alarming downward spiral over the past several months.
The British Bankers Association reported that lenders approved around 28,000 mortgages last month. This represents a decrease of 57% in comparison to the mortgage approval figures for May 2007. Major lenders are said to be continuing to impose a series of financial belt tightening measures which include withdrawing certain mortgage products and increasing interest rates.
Housing industry experts suggest that the economic downturn is ensuring that the sector will continue to see a steady decline in the near future. The dip in mortgage approvals provides further evidence that the current house price situation shows no signs of stabilising. Some analysts rejected any talk of economic recovery and predicted a 10% fall in prices by the end of 2008.