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Deckard

U.k. Mortgage Lending Up In June

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http://www.bloomberg.com/apps/news?pid=206...id=atfTVhw.NJbs

July 20 (Bloomberg) -- U.K. mortgage approvals by the nation's six biggest banks increased in June in a sign real- estate lending may strengthen, the Bank of England said.

The number of loans granted for house purchase rose to 51,100, the highest since records began in December, from 45,000 in May, according to a sample from the central bank's lending panel released today in London. Lending for homebuyers increased to 4.7 billion pounds ($7.8 billion) from 4.3 billion pounds the previous month.

``The major U.K. lenders reported a further rise in approval for house purchase in June, suggesting that mortgage lending for house purchase may continue to strengthen in coming months,'' the bank said in the report.

Merv, we need some positive figs on the housing market - NOW !!! ;)

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If these figures are right (and if my maths is right), that indicates an average loan of £91,976.

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As lending is up again does mean that Alistar Darling doesnt need to go and tell the banks to lend more now?

bet he still tells them to open up the coffers a bit more!

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Mortgage lending hits six-month high on 17% rise

Mortgage lending to homeowners jumped 17 per cent in June according to new figures, but economists remain cautious over the strength of the property market.

The Council of Mortgage Lenders (CML) said that gross mortgage lending hit a six-month high of £12.3 billion in June, up 17 per cent from £10.5 billion recorded in June.

However, the figures, which include lending for house purchases and re-mortgaging, were tempered by more gloomy economic news from the Bank of England showing that lending to businesses has fallen for a second consecutive month.

The Bank's Trends in Lending report showed that net lending to businesses in May fell by £3.4 billion following a £6 billion fall in April.

The times take on the figures.

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Here's the July approvals from the BoE Trends in Lending report - figures from the UK Banks lending panel (red dots), and BoE total approvals SA (green line). As pointed out above, this 51k in the current market conditions appears consistent with broadly neutral HPI.

20sal95.jpg

BoE Trends in Lending report and Excel downloads, July/09

http://www.bankofengland.co.uk/publication...dsinlending.htm

Edited by spline

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Here's the July approvals from the BoE Trends in Lending report - figures from the UK Banks lending panel (red dots), and BoE total approvals SA (green line). As pointed out above, this 51k in the current market conditions appears consistent with broadly neutral HPI.

20sal95.jpg

BoE Trends in Lending report and Excel downloads, July/09

http://www.bankofengland.co.uk/publication...dsinlending.htm

Well I've been share trading since the early 90s and looked at thousands of graphs.

Honestly bulls, I'm not just seeing what I want to see.

Dead

/\/\___Cat

/\/\/\/\/\___Bounce.

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Well I've been share trading since the early 90s and looked at thousands of graphs.

Honestly bulls, I'm not just seeing what I want to see.

Dead

/\/\___Cat

/\/\/\/\/\___Bounce.

Honestly I'm surprised at the lack of bulls, My position changes but I think I am currently on the bearish side of neutral...

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Guest DissipatedYouthIsValuable

This includes remortgaging?

Or remoregagging?

Edited by DissipatedYouthIsValuable

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This includes remortgaging?

Or remoregagging?

And just to confirm – figures are approvals for house purchase, seasonally adjusted, and the green line is net of cancellations.

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As pointed out above, this 51k in the current market conditions appears consistent with broadly neutral HPI.

People still buy in a falling market. How can you come to the conclusion this points to neutral HPI?

The 'current market conditions' - thousands losing their jobs? Don't see how you can base your conclusion on only one factor.

You need sales (and thus mortgages) to drive down prices anyway.

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Spline. If I am reading this correct you are saying that only 51k approvals needed to keep prices at this current level?

Interesting that the amount lent per loan appears to have fallen by around 3% since the previous month which is in line with what I have always said i.e. the banks will grant loans but for lower amounts.

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Despite the current media reports it seems like our local market has started to slow in the last few weeks. I've noticed a lot more property on the EA's books and very little selling!

What trust/spin the media has built up over the last few weeks is surely going to be gone big time in the Autumn.

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bloomberg ticker says number of loans likely to rise as Approvals, which are NOT loans, are up.

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Here's the July approvals from the BoE Trends in Lending report - figures from the UK Banks lending panel (red dots), and BoE total approvals SA (green line). As pointed out above, this 51k in the current market conditions appears consistent with broadly neutral HPI.

20sal95.jpg

BoE Trends in Lending report and Excel downloads, July/09

http://www.bankofengland.co.uk/publication...dsinlending.htm

broadly neutral HPI....which is where we are... well done Mr Spline.

And Dr Bubb for predicting it.

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Spline. If I am reading this correct you are saying that only 51k approvals needed to keep prices at this current level?

Broadly, the housing market is unusual in that HPI correlates surprisingly strongly with transactions, and since transactions are difficult to get a timely handle on it’s convenient to proxy then using the BoE approval numbers.

The current market conditions have a much lower ratio of mortgage-to-cash buyer and the approvals proxy sits a bit lower down and you need to compensate. Alternatively, and probably much simpler, is just to recalculate the neutral level and let it drift around (slowly) in step as the structure of the market drifts about. This is part of what the Kalman house price predictor is doing when it is fusing the approvals and Halifax data, the neutral level comes as part of the method.

But note that as the approval numbers recover, so presumably will the mortgage-to-cash ratio, and the neutral level will drift back up to historic levels.

Edited by spline

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1990[/size]

1 January

1.1 Saturday 06 JAN 1990 - The Times - Recovery forecast for house prices in market awash with loan funds

1.2 Saturday 06 JAN 1990 - The Times - House prices in 2% year-end fall

1.3 Saturday 20 JAN 1990 - The Times - House prices in London drop by 10%

2 February

2.1 Sunday 18 FEB 1990 - The Sunday Times - House prices may fall still further

2.2 Tuesday 27 FEB 1990 - The Times - Price of houses 'to fall 10%'

3 March

3.1 Wednesday 07 MAR 1990 - The Times - House prices rise but trend is down

And a little bit later .............

1995

1 January

1.1 Sunday 01 JAN 1995 - The Sunday Times - House prices poised for modest recovery

1.2 Wednesday 11 JAN 1995 - The Times - House price optimism

2 Februrary

2.1 Thursday 02 FEB 1995 - The Times - House prices

2.2 Sunday 12 FEB 1995 - The Sunday Times - House prices set for a `five-year freeze'

3 March

3.1 Thursday 02 MAR 1995 - The Times - Manufacturing picks up but house prices stagnate

4 April

4.1 Wednesday 05 APR 1995 - The Times - House prices fall 1.5% as Halifax piles on gloom

5 May

5.1 Wednesday 03 MAY 1995 - The Times - Halifax reports further decline in house prices

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But note that as the approval numbers recover, so presumably will the mortgage-to-cash ratio, and the neutral level will drift back up to historic levels.

That's what was confusing me. I expected the neutral level to start climbing with the increase in approvals.

Still, approval value has fallen month on month.

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Looking at the small number of properties I am monitoring, currently 34, I concur

May - 6 SSTC

June - 14 SSTC

July - 1 SSTC (still 11 days to go)

Cat bounced!

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