I knew things were bad, but that bad?
Lenders have clamped down on lending, demanding high standards.
The Labor government is ignored.
Its political fortunes are tied to the economy which appears headed for recession.
Mortgage lending for house purchases fell to its lowest level for more than three decades in the first three months of the year, figures revealed.
The Council of Mortgage Lenders (CML) said the number of loans for house purchases plunged to 142,000 between January and the end of March – the lowest on record since the first quarter of 1975.
The data also showed lending to first-time buyers and home movers nearly halved year-on-year in March, to 46,500, down 1% since February and 48% on the 89,000 seen last March.
The figures add to the gloom in the housing market, with the Royal Institution of Chartered Surveyors (RICS) also painting a grim picture for UK property, with news that surveyors are nearly unanimous in seeing price falls amid a transaction stalemate between buyers and sellers.
The credit crunch is affecting borrower access to loans, but both RICS and the CML warn that there is a growing gap between buyer and seller expectations on price, which is leading to a collapse in the number of housing transactions.
The CML forecast that the dire house purchase lending figures are set to get worse as transactions continue to decline.
First-time buyer loans saw a 1% drop on February to 17,900 in March, or down 45% year-on-year, according to today’s CML data.
Total mortgage advances were also revised down to £24.1 billion for March from the previous estimate of £26.3 billion – now less than 5% up on the previous month and a fraction of the usual 20% hike seen between February and March.
But the CML reported remortgaging activity remained resilient, increasing in the first quarter to £33.3 billion, which accounted for 44% of gross lending and its highest level for three years as borrowers came off two and three-year fixed rate mortgages.