Gross mortgage lending declined in January

Rinoa

Fall in January lending only to be expected due to the stamp duty effect.

CML say mortgage advances in the £125k-£175k band increased by 56% in December as deals were brought forward from January.

BoE Trends in Lending report shows a dip in approvals for January, but if the snow stops buyers venturing out and surveyors are unable to value property then that's hardly surprising.

I'm surprised approvals reached 49000 TBH.

Brrrrr... it were cold in January.

bernard_shaw

doire wrote: »

Up 200% in Aberdeen

Sir_Humphrey

Rinoa wrote: »

Fall in January lending only to be expected due to the stamp duty effect.

CML say mortgage advances in the £125k-£175k band increased by 56% in December as deals were brought forward from January.

BoE Trends in Lending report shows a dip in approvals for January, but if the snow stops buyers venturing out and surveyors are unable to value property then that's hardly surprising.

I'm surprised approvals reached 49000 TBH.

Brrrrr... it were cold in January.

The last two weeks or so of December was snowed out in most of the country, and there is the little matter of Christmas too.

December lending was also a little down on November.

I am not drawing any firm conclusions until the February figures are released however.

Graham_Devon

Rinoa wrote: »

Fall in January lending only to be expected due to the stamp duty effect.

Compared to December yes. But this number is also 21% down on January 2009, which also had snow if I recall correctly.

And in any case, I'm not really sure how the snow may stop mortgage's going through. Sure, it might delay it a couple of days due to staff absense, but not really getting why snow could even be blamed.

Even if you tried to state that the snow stopped people looking at houses and applying for mortgages, it still takes more than a couple of weeks usually for the house sale to be agreed, and also the mortgage to be agreed. So how we could blame snow for halting proceedings in the same month as it snowed, I'm not sure.

The snow would more likely have an effect on feb's mortgage figures wouldnt it? Snow clears, people go look at houses again, and apply for mortgages....which get sorted in feb.

Rinoa

Graham_Devon wrote: »

Compared to December yes. But this number is also 21% down on January 2009, which also had snow if I recall correctly.

And in any case, I'm not really sure how the snow may stop mortgage's going through. Sure, it might delay it a couple of days due to staff absense, but not really getting why snow could even be blamed.

Even if you tried to state that the snow stopped people looking at houses and applying for mortgages, it still takes more than a couple of weeks usually for the house sale to be agreed, and also the mortgage to be agreed. So how we could blame snow for halting proceedings in the same month as it snowed, I'm not sure.

The snow would more likely have an effect on feb's mortgage figures wouldnt it? Snow clears, people go look at houses again, and apply for mortgages....which get sorted in feb.

Yes but don't forget we're talking gross mortgage lending here which also includes remortgages ~ and remortgaging has fallen like a stone as borrowers simply revert to their lenders cheaper SVR. Gross lending has only been kept higher in the latter part of 2009 as mortgage lending for house purchase steadily increased month by month.

But due to the stamp duty effect, lending for house purchase fell sharply in January. Add this to the continued decrease in remortgaging and the blip in the data is easily accounted for.

Sir_Humphrey

Rinoa wrote: »

Yes but don't forget we're talking gross mortgage lending here which also includes remortgages ~ and remortgaging has fallen like a stone as borrowers simply revert to their lenders cheaper SVR. Gross lending has only been kept higher in the latter part of 2009 as mortgage lending for house purchase steadily increased month by month.

But due to the stamp duty effect, lending for house purchase fell sharply in January. Add this to the continued decrease in remortgaging and the blip in the data is easily accounted for.

The OP was referring to CML gross lending. I then added a further reference to BoE mortgage approvals for purchasing, which is what I was commenting on.

http://www.nasdaq.com/newscontent/20100218/uk-mortgage-approvals-at-half-year-low.aspx?storyid=20100218_30b347f4-f771-4dbd-b459-d8256cb2eaf2_fxstreet.com

I notice that the Bloomberg link was broken, which is perhaps why this was not clear. The link above has the same story.

Rinoa

Sir_Humphrey wrote: »

The OP was referring to CML gross lending. I then added a further reference to BoE mortgage approvals for purchasing, which is what I was commenting on.

http://www.nasdaq.com/newscontent/20100218/uk-mortgage-approvals-at-half-year-low.aspx?storyid=20100218_30b347f4-f771-4dbd-b459-d8256cb2eaf2_fxstreet.com

I notice that the Bloomberg link was broken, which is perhaps why this was not clear. The link above has the same story.

Sorry Humph, my reply was to Graham Devon but I hit your quote button by mistake.

I'm looking for the confused smiley but it's gone.

chucky

Sir_Humphrey wrote: »

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aaRFGTMPaQOo

Mortgage approvals fell to 49000 in January, down from 60000 in December. It is a bit difficult to blame the weather IMO as both months had a lot of snow. It will be interesting to see the February figures.

This could explain some of the slightly more generous mortgage deals we have seen since the New Year. If demand for loans falls, then so will the rates that are able to be charged (qv GlobalARTrader over on the Motley Fool board).

EDIT: Link repaired

do we know the amount lent to the 49,000?

Graham_Devon

Rinoa wrote: »

Yes but don't forget we're talking gross mortgage lending here which also includes remortgages ~ and remortgaging has fallen like a stone as borrowers simply revert to their lenders cheaper SVR. Gross lending has only been kept higher in the latter part of 2009 as mortgage lending for house purchase steadily increased month by month.

But due to the stamp duty effect, lending for house purchase fell sharply in January. Add this to the continued decrease in remortgaging and the blip in the data is easily accounted for.

People simply couldn't re-mortgage in Jan 2009. Remember the credit crisis that was going on then?!

So still don't explain things.

chucky

Graham_Devon wrote: »

People simply couldn't re-mortgage in Jan 2009. Remember the credit crisis that was going on then?!

So still don't explain things.

i'm sure that most could remortgage - they just didn't want to fix at higher rates instead of staying on a cheaper SVR or tracker and save money...