Mortgage News Archive     ( 1 ) ( 2 ) ( 3 )

New home mortgage approvals rise slightly      28/05/2008

Mortgage approvals for new home purchases picked up slightly in April but remain nearly 40 per cent below the levels of a year ago, according to the latest lending data from the British Bankers\' Association. 

The BBA, pointing to strong remortgaging activity which was 20.3 per cent above that in April 2007, said the latest data show a healthy market with 74,722 loans approved. Its members account for about two-thirds of all home loans made in Britain. David Dooks, BBA statistics director, said: 

"There is an active remortgaging market as people switch lenders to obtain better deals. It is clear that contrary to reports, the mainstream mortgage market has not ground to a halt." 

But economists noted that the 38,704 mortgages for house purchases in April were the second lowest on record and did not square with a picture of a recovering housing market.

Credit crunch is testing borrowers' resolve      29/04/2008

The Mortgage Advice Bureau (MAB) has seen its amount of remortgaging business rise by 27% in the first quarter of 2008 compared with the same period last year. Brian Murphy, head of lending at MAB, says: 

"The ongoing credit crunch cyclone is continuing to test borrowers\' resolve. With less people choosing to buy, increasing levels of business now comes from remortgage clients. "Within the mortgage arena, the demise of the 100% mortgage also indicates a relatively bleak outlook for first time buyers." 

The same report found a downward trend in fixed rate deals for MAB.

Merrill Lynch unveils heavy losses      18/04/2008

After more write-downs linked to the embattled credit markets Merrill Lynch has reported heavy losses from the first three months of 2008. 

The firm said it lost $1.96bn (£1bn) compared with a profit of $2.1bn in the same period a year earlier - broadly in line with what analysts had expected, including about $4.5bn of write-downs for subprime mortgages and other risky assets. 

As it unveiled plans to cut about 4,000 jobs worldwide, Chief executive John Thain said that the firm remained "well-capitalised" and that there were no plans to raise more capital. Analysts have blamed poor risk management for Merrill's over-exposure to bad sub-prime mortgage debt. Earlier this week JP Morgan Chase boosted markets, by revealing no major new woes.

Bank rate decision today      10/04/2008

The Bank of England's Monetary Policy Committee (MPC) decides today whether or not to cut the base rate from its current level of 5.25%. 

With the Halifax revealing that average UK house prices dipped by 2.5% in March, the biggest drop in over 15 years, many analysts believe a rate cut of 0.25% is odds on. 

"The increasing danger of a sharp housing market correction heightens pressure on the Bank of England to cut interest rates by a further 25 basis points," said Howard Archer at Global Insight. "We expect the Bank of England to act, despite still serious inflation risks. However, these inflation risks mean that today's likely interest rate cut will be limited to 25 basis points." 

Richard Lambert, the Confederation of British Industry's director general, said: "A quarter-point cut in interest rates is needed to help businesses and consumers cope with the impact of the credit crunch."

Mortgage squeeze set to continue      04/04/2008

According to the Bank of England's Credit Condition Survey, the squeeze on the availability of mortgages is expected to continue in the next three months, and predicts that demand for home loans was likely to fall slightly during the same period. 

The survey confirmed that lenders had reduced the availability of mortgages in the three months to mid-March, and expected a slightly larger reduction over the next three months. "The survey suggests that there has been no improvement in conditions," said Philip Shaw, chief economist at Investec. "In fact, the situation has deteriorated further and that's consistent with the news over the past few days that mortgage lenders have been raising their rates and withdrawing products."

House prices fall 0.2% in March      01/04/2008

According to the Hometrack monthly housing survey, the average price for a property across the country fell by 0.2% between February and March, taking annual house price growth to 0.4%, the lowest recorded level since March 2006. 

In response to the still slowing market, Hometrack predicts sales transaction volumes will fall by 17% over the course of 2008, as the majority of households simply do not need to move.
 
"Continued uncertainty in the financial markets, affordability pressures and weak buyer confidence are all likely to suppress levels of market activity in the months ahead with pricing levels remaining under pressure," commented Richard Donnell, director of research at Hometrack.

One fifth of homeowners considering renting      31/03/2008

Around 18% of homemovers are considering stepping off the property ladder amid fears over the faltering housing market, a poll by website iammoving.com shows. 

This group would then rent a property and buy another once prices have fallen. Some 14% of 1,100 homemovers polled said that money worries could force them to drop out of the property market. 

Other reasons for a move into rental included relationship breakdowns and a desire to emigrate. 

"You expect people to consider renting when the market is falling because there is a chance to make money, but 18 percent is a high figure," said Simon Preston, chairman of iammoving.com. "Much of this is down to the problems in the housing market and the fact that people are struggling financially."

UK house price growth at 12-year low      31/03/2008

UK house prices fell more than expected in March, with the annual rate of growth slowing to its weakest level in 12 years, the Nationwide Building Society has said. 

House prices fell by 0.6% in the month, the fifth consecutive monthly drop, taking annual inflation to just 1.1%. The average price of a home now stands at £179,110, compared with the £179,358 seen in February. 

"We expect a modest fall in house prices during the year, but such a fall should be seen in context," 

Nationwide Chief Economist Fionnuala Earley said in a statement. "A moderate fall in prices at this stage shouldn't be unwelcome and should help to ensure greater stability in the market going forward."

Government should promote equity release, says CML      25/03/2008

The Government is being called upon to do more to promote equity release among UK homeowners. A new report from the Council of Mortgage Lenders (CML) looked into why equity release is more popular in Australia, the US and New Zealand than it is in the UK. 

The report highlighted that UK homeowners are more concerned about risk and the CML said that the Government should be doing more to highlight the benefits of equity release. "The Government should recognise that, given its concern to build a society in which ownership of assets is a priority, it should help create and sustain ways in which people can exploit these assets," said Peter Williams, the CML report's author.

Europe slows, while Far East hots up     25/03/2008

Global house price inflation in the fourth quarter of 2007 stood at 8.2%, according to the latest research from estate agent Knight Frank. This is compared with growth of 9.9% over the same period of 2006. Bulgaria, Russia, Poland, Hong Kong and Singapore have all experienced high annual price growth between 2006 and 2007, with Bulgaria coming top for annual capital appreciation. 

Liam Bailey, head of residential research at Knight Frank, said: "This index shows that while property prices in Europe and America appear to be suffering from the downturn in economic conditions, prices in Asia and elsewhere, notably Singapore and Hong Kong, are performing very well."


Further Mortgage News ( 1 ) ( 2 ) ( 3 )