MSE News: Large dip in mortgage lending

This is the discussion thread for the following MSE News Story:

"The number of mortgages approved for home buyers dived by 17% during January as the housing market suffered a steep fall in activity, figures show today ..."

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Large dip in mortgage lending


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Replies

  • de1amode1amo Forumite
    3.4K Posts
    if this doesnt show a sign that things are spiralling downwards i dont know what would!!
    mfw'11 No68- 55k mortgage İO--little to nothing saved! i must do better.
  • Dan_1976Dan_1976 Forumite
    943 Posts
    Well I have said it a few times, house prices and mortgages etc have been picking up to fast. This may not be a bad thing. We need to take it slowly and I think we need to get to a point where you can buy a house with a 15% deposit and borrow between 3.5 and 3.75 times income with a good affordability.

    When I joined the BS i worked for the max income multi was 3.75 and you had to be god to get that. WHen I left they were lending upto 4.5 and 5 times.

    I dont mean to sound negative, I do want things to pick up, but not house prices, they are still too high for mr and mrs average.

    The lenders have probably thought they are lending to much so lets slow it down.

    Then again, it could be a seasonal thing with the snow etc lol
    "Banking establishments are more dangerous than standing armies." Thomas Jefferson
    "How can I believe in God when just last week I got my tongue caught in the roller of an electric typewriter?" Woody Allen

    Debt Apr 2010 £0
  • de1amode1amo Forumite
    3.4K Posts
    gone have the days of high multiples and high ltv-the valuers are being ultra cautious--the brakes are being applied by stealth--it will go into overdrive when the money supply boost dries up and the svrs are raised by the societies--the boe rate will become more disconnected
    mfw'11 No68- 55k mortgage İO--little to nothing saved! i must do better.
  • MiserlyMartinMiserlyMartin Forumite
    2.1K Posts
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
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    Not long until house price crash part 2 starts which will get us back to affordable houses priced at 3 times the average one wage.
  • dunstonhdunstonh Forumite
    109.4K Posts
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
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    de1amo wrote: »
    if this doesnt show a sign that things are spiralling downwards i dont know what would!!

    The 90s house price crash showed a number of false dawns.

    However, both of my mortgage advisers are really busy on mortgages but both said that things went quiet during the bad weather as no-one went out unless they had to and appointments got moved around or put back.

    So, it could just be weather effects. Plus, the media and markets went a bit negative again and that may have put people off.

    You mustnt forget Christmas either. The knock on effect of a few weeks out in December tend to reflect in January and even February as mortgage advances at their quickest tend to lag applications by a month or two.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • Dan_1976Dan_1976 Forumite
    943 Posts
    I agree Big D, I think we will have to see what Feb and March bring, weather is better at the mo and people are already more positive about life!

    Dan
    "Banking establishments are more dangerous than standing armies." Thomas Jefferson
    "How can I believe in God when just last week I got my tongue caught in the roller of an electric typewriter?" Woody Allen

    Debt Apr 2010 £0
  • wodgerdodgerwodgerdodger Forumite
    186 Posts
    Traditionally January was not a good month for new mortgage applications and this year has been compounded by the pulling of Stamp Duty to 175K by end december.
    There was clearly a rush to get business completed by then and now with this incentive for FTB purchasers removed there was bound to be a reaction.

    As others have stated the February and more importantly March figures will give a truer picture of what is happening in then marketplace but it is already quite noticeable of a higher number of properties coming on to the market in the last few weeks.
  • de1amode1amo Forumite
    3.4K Posts
    back in the late 80s the big property slump was caused by Margret Thatcher removing MİRAS tax rebate on mortgages and this tipped the balance and a big unwinding of a property bubble--there were loads of properties available but all over valued as people sought to escape the market-why are people suddenly marketing their properties and feeling good about the economy? and where are the loans coming from at the bottom of the chains to start the market moving?-if i was a buyer i would have got my purchase in before the end of the tax holiday!!
    mfw'11 No68- 55k mortgage İO--little to nothing saved! i must do better.
  • Dan_1976Dan_1976 Forumite
    943 Posts
    I think we will see another drop in prices. They have not dropped enough.

    Take an average wage of 25k times it by 4, add in the fact your the bread winner for a family of 4, two young ones so partner works and earns 5-6k per annum. How can they buy a house?

    I know you will all start moaning about saving etc, but in real life not everybody saves.

    I think a lot can be said for council housing and we are now paying for the sale of nearly all our stock.
    "Banking establishments are more dangerous than standing armies." Thomas Jefferson
    "How can I believe in God when just last week I got my tongue caught in the roller of an electric typewriter?" Woody Allen

    Debt Apr 2010 £0
  • de1amode1amo Forumite
    3.4K Posts
    maggie sold the council houses and most of the silverware in the last property and economy crash--in my oppinion she just staved off the inevitable--outside the uk they see us as a bankrupt and resourceless society--the oil is running out the service industry is disappearing and unless we re-invent ourselves we are 'doomed to third world status of which Maggie staived off in the late 70s-- no more high property prices but more austerity(sp)
    mfw'11 No68- 55k mortgage İO--little to nothing saved! i must do better.
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