Saturday, Sep 22, 2007
Sheeple, read and weap
Mirror: House Prices at Breaking Point
Latest figures show a whopping 70 per cent fall in the amount being borrowed from building societies for home loans.
They lent £656million in August 2007, versus £2,190m in August 2006.
Posted by auntie @ 09:43 AM (654 views) Add Comment
9 Comments
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1. Qetesuesi said...
NB the headline actually says "Home prices at BRAKING point" - a somewhat different concept, although amounting to the same thing. Is that a typo though or did they really mean it?
2. Tulipmania said...
The figure from the Building Societies Association really is startling. If new mortgage lending really is 2/3 down on last year that'll have an enormous effect. I wonder however whether this figure represents the overall picture, the figures from the British Bankers Association don't show such a drop. Perhaps some buiding societies have converted in the past year affecting the figures. Either that or mortgage lending has fallen off a cliff which means house prices are going to follow in a few months time.
3. planning4acrash said...
"Across banks and building societies mortgage lending fell to £32billion, down £1bn on August last year"
There aren't many building societies left, so the 70% is not as big as it seems, but this is big news, more properties for sale, less money to buy them, forced sales, prices must go DOWN!
4. Uro_who said...
I can't find these figures anywhere on the council of mortgage lenders site. All I can see is a press release that says down 6% overall. Not quite sure where the figures came from.
5. inbreda said...
No reason why a similar thing isn't happening in the banks.
And that's not to mention the fact that the people still going for loans are either stupid or desperate for cash to remain solvent. Basically the very first type of people that the banks will not want to lend to in this new slightly-more-risk-averse world that we find ourselves in.
That can only bring prices down. And when that happens, the proportion of loan applicants that would be considered a bad credit risk will rise, more applications will be rejected, and prices will fall further.
This article is strong evidence that the downward spiral has started and further support from other sources is beginning to surface.
BTL will be dead by Christmas IMO
6. dohousescrashinthewoods said...
I was just amazed at such a clear, reasonably well written article in the Mirror. There is hope for ordinary people yet.
7. david20040_0 said...
No with the Abbey offering 125% at 6* salary.
The boom will return.
The govt has screwed up offering to bail out banks and taken the risk away from them.
8. crash bandicoot said...
David,
6x salary is subprime. I am not sure of Abbey's reasons for offering this in the current climate (although it smacks of despiration) but unless others start offering it soon, Abbey will pick up all of the bad borrowers. Doesn't sound like a good business plan does it?
As for the article, you can't underesimate the impact upon the market of the Mirror telling the man in the street that house prices are heading for a meltdown. Faced with this who will want a 6x mortgage?
9. planning4acrash said...
I love it how the Mirror use words like "Whopping" !!