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Heavy Fall In Purchase Approvals For January

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http://www.introducertoday.co.uk/News/Story/?storyid=3931&title=Heavy_fall_in_purchase_approvals_for_January&type=news_features

Early signs are that the housing mortgage market is continuing to weaken more sharply than had been widely predicted.

This is despite today's Halifax house price survey, showing that prices rebounded by 0.8% in January making good the 0.7% drop over the previous three months.

Purchase approvals fell 6.2% in January compared with the month before – itself a weak month.

The new data is based on the valuations activity of a national firm of chartered surveyors, e.surv, the largest distributor and manager of valuation instructions in the UK and which works for over 25 lenders.

The firm says there was a marked drop in demand, and that the housing market stalled in January.

It puts the total number of mortgage approvals at 39,905 which is 17.4% down on last January.

The firm also says that purchase volumes fell by a similar amount across all price bands, up to £750,000. Above this level, volumes fell faster, although it points out that sales volumes in the most expensive properties have held up better than the overall market.

Richard Sexton, business development director at e-surv, said: “The weather has been shouldering the blame for everything later. But this has merely exacerbated the underlying weakening trend in the housing market.”

He added that lenders had pulled back from the market in both December and January.

But he said: “Initial signs are that February will show some improvement.”

David Brown, commercial director of LSL Property Services, parent company of Reeds Rains and Your Move, said of the figures: “They unsurprisingly paint a fairly gloomy picture, given the impact of the weather.

“It’s clear that many lenders are still focusing on repayments to the Government rather than on higher LTV new lending to first-time buyers.

“As depressed levels of lending continue to hamper the number of first-time buyers able to get on to the property ladder, the private rental sector will play an increasingly pivotal role in the housing market.”

Halifax said of its latest figures for January that house prices would continue to fluctuate all this year. It said January's house price bounce was due to fewer properties coming to the market.

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It puts the total number of mortgage approvals at 39,905 which is 17.4% down on last January.

January last year was a very weak month too as the stamp duty holiday ended in December so most people rushed through purchases that would normally have taken place in January.

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Would have thought volumes would be up on December, particularly with all of the snow.

Also remember that we got similar amounts of snow in January 2010, making it a very weak month, and this month is 17.4% lower than that!

Edited by fellow

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The new e.surv Mortgage Monitor needs to prove itself. The company stated in its December press release that:

The typical margin of error on a monthly basis is 1% compared to the Bank of England final approvals data.

In November they forecast 48,846 approvals and the BoE figure eventually came in at 47,287 – a difference of 3.3%.

In December they projected 47,763, but the BoE’s figure came in much lower, at 42,563 – a whopping 12.2% miss.

It’s early days, but unless they can get more accuracy I’m not sure this survey is going to be of much use (at least as an early indicator of approvals).

Edit: grammar

Edited by FreeTrader

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The new e.surv Mortgage Monitor needs to prove itself. The company stated in its December press release that:

The typical margin of error on a monthly basis is 1% compared to the Bank of England final approvals data.

In November they forecast 48,846 approvals and the BoE figure eventually came in at 47,287 – a difference of 3.3%.

In December they projected 47,763, but the BoE’s figure came in much lower, at 42,563 – a whopping 12.2% miss.

It’s early days, but unless they can get more accuracy I’m not sure this survey is going to be of much use (at least as an early indicator of approvals).

Edit: grammar

Do you know when the BOE figures are released? Do you expect them to be lower than this figure?

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Do you know when the BOE figures are released? Do you expect them to be lower than this figure?

BoE figures won't be out until 1st March.

I've no idea what they'll be, but I must say I thought the BoE number for December seemed anomalous. The very heavy drop didn't tie in with the British Bankers' Association (BBA) number which had been released a week earlier, and the recent pattern of approvals from non-BBA lenders.

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Will this help with falls, most likely not.

Was reading somewhere else that Halifax now only account for 6% of the market now.

It's looking like a slow grind down with inflation doing most of the work.

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The new e.surv Mortgage Monitor needs to prove itself. The company stated in its December press release that:

The typical margin of error on a monthly basis is 1% compared to the Bank of England final approvals data.

In November they forecast 48,846 approvals and the BoE figure eventually came in at 47,287 – a difference of 3.3%.

In December they projected 47,763, but the BoE’s figure came in much lower, at 42,563 – a whopping 12.2% miss.

It’s early days, but unless they can get more accuracy I’m not sure this survey is going to be of much use (at least as an early indicator of approvals).

Edit: grammar

It would appear to be more of a lagging than leading indicator as the big drop in BOE was December and this shows a big drop for January.

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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