Bank of England Issues Pessimistic Home Loan Outlook

Mon, 05 Jul 2010

The Bank of England has issued a grim warning to homebuyers about the state of home loan funding for the next quarter. Mortgage approvals totalled just £1.2 billion in net funds for house purchases in May, while the house index saw a nominal increase of just 0.1 per cent. In light of these figures, the Bank has predicted a decrease in the supply of home loan funding during the next three months. If the forecast proves correct, it would be the first decline since the end of 2008.

The early months of 2010 saw a slowdown in the number of mortgage approvals, though analysts had predicted this dip following a surge in activity ahead of the return of stamp duty at the beginning of 2010.

Despite lenders predicting an increase in demand for mortgages in the second quarter of 2008, this greater demand failed to appear, with lenders citing continued concern about employment, the economy and interest rates as the reason for this lack of demand.

With demand for home loans still low, and banks still cautious about who they lend to, it could be some time before there is a sharp increase in property prices.
add to favouritesnewsletterlink to this pagesend to friendpost comments

Link to this page

Copy and Paste the following HTML into your page.

 

 

Income Protection Insurance
Get an instant quote with the award winning company

Paying Too Much?

7 out of 10 people are paying too much for their mortgage. To find out if you're one of them click here or fill out a FREE no obligation enquiry form