ollie plimsolls Posted July 18, 2008 Share Posted July 18, 2008 (edited) CML Gross mortgage lending declined to an estimated £23.8 billion in June, down 3% from May and 32% from June 2007, according to the Council of Mortgage Lenders. The decline between the first and second quarter was a marginal 1%. However, an increase would typically be expected in spring. The year-on-year decline has gathered pace in recent months; lending in the first quarter of 2008 was down 11% on 12 months earlier, while the second quarter was down 21%. CML director general Michael Coogan commented: “Market activity during a traditionally a busy time of year for mortgages has been muted by funding shortages and, more recently, dampened consumer demand. “While by historic comparisons we still have had a good level of gross lending, new net lending has been constrained in 2008 and this picture will continue for the rest of this year. “Government efforts to help housing associations purchase new-build properties and borrowers to save for a deposit are welcome, but are likely to have only a marginal impact on the housing market. The recent reduction in short-term fixed-rate mortgage costs is a small bit of welcome news for hard-pressed households facing significant pressures on their finances from the higher cost of food and fuel, in particular. “However, borrowers on tight budgets will have to plan ahead to manage higher mortgage payments than they have been used to. Speak to your lender early remains the advice for anyone struggling to pay.” Edited July 18, 2008 by ollie plimsolls Quote Link to comment Share on other sites More sharing options...
Realistbear Posted July 18, 2008 Share Posted July 18, 2008 CML So a drop of 32% YoY is "muted?" 5-10% down would be a "correction." 20% down is normally seen as a "crash." 32% is a good deal worse than crash speed, but not "muted." Muted? Quote Link to comment Share on other sites More sharing options...
Guest KingCharles1st Posted July 18, 2008 Share Posted July 18, 2008 problem is wit htese YOY figures, is that come 12 months time- the YOY will look much better (as I doubt the lending could drop that much further) -in fact we will be open to utter ramping saying YOY has GONE UP!!! Hmmm.... Quote Link to comment Share on other sites More sharing options...
bobthe~ Posted July 18, 2008 Share Posted July 18, 2008 problem is wit htese YOY figures, is that come 12 months time- the YOY will look much better (as I doubt the lending could drop that much further) -in fact we will be open to utter ramping saying YOY has GONE UP!!!Hmmm.... But prices will still be going down. Even assuming you are right. I think Converted Lurker was complaining 6 months ago that the CML were publishing Gross figures which included re-mortgages because they were holding up pretty well. Not holding up so well now though. Quote Link to comment Share on other sites More sharing options...
redwing Posted July 18, 2008 Share Posted July 18, 2008 problem is wit htese YOY figures, is that come 12 months time- the YOY will look much better (as I doubt the lending could drop that much further) -in fact we will be open to utter ramping saying YOY has GONE UP!!!Hmmm.... I'm not so sure. Looking at CML figures going back to 2002, this June is about the same as June 2003 ( £23,800m in 2008 vs £22,900m in 2003). The value of gross lending is made up of (£ new lending + £ re-lending) x volumes. As prices fall then £ new lending per property will fall, and folk re-mortgaging won't be able to if they need to borrow very high LTVs. We could see the Gross Lending £ numbers continue to fall for quite some time as property values continue their descent, as lenders carry on with fairly tight lending criteria at rates designed to bolster their margins, and as property sales volumes are depressed (unlikely to pick up till we've hit bottom imo). Or put it another way. If prices drop 30% then that means mortgage lending will fall 30% if all other variables remain the same. Because mortgage lending is ultimately based on the value of the assets it is secured against. Quote Link to comment Share on other sites More sharing options...
redwing Posted July 18, 2008 Share Posted July 18, 2008 Since 2002 Source CML Quote Link to comment Share on other sites More sharing options...
bearbullfence Posted July 18, 2008 Share Posted July 18, 2008 So a drop of 32% YoY is "muted?"5-10% down would be a "correction." 20% down is normally seen as a "crash." 32% is a good deal worse than crash speed, but not "muted." Muted? Depends whether you consider last years figures to be typical volumes. Quote Link to comment Share on other sites More sharing options...
redwing Posted July 18, 2008 Share Posted July 18, 2008 Depends whether you consider last years figures to be typical volumes. If you look at the graph I posted above, you'll see that the last two years have been aberrant. We're now back to summer figures of between 20bil - 25bil. In the post above the graph is the reason I think we'll be even lower than now in a year's time. Quote Link to comment Share on other sites More sharing options...
ImA20SomethingGetMeOutOfHere Posted July 18, 2008 Share Posted July 18, 2008 Time was when this would be at 10 pages by now. I guess the forum's just so bloated from all the bear food it can barely stir a paw in reply. Quote Link to comment Share on other sites More sharing options...
redwing Posted July 18, 2008 Share Posted July 18, 2008 Time was when this would be at 10 pages by now.I guess the forum's just so bloated from all the bear food it can barely stir a paw in reply. I agree whole-heartedly. I first found this languishing on page 2 late this afternoon. Considering this is probably the major housing/houseprice news of the day - that's surprising. Increasingly, I find myself having to wade through page after page of dross posts started by people with nothing else but their own opinions, and then full of inane, imbecilic comments. Perhaps we need a subforum where we can discuss house prices and the housing market. I still like the 'In your area', the 'anecdotals' and the 'rentals' bits of hpc. There seems to be more actual discussion of the issues there. The main forum is pretty much a waste of time. I'm considering putting all my posts in the economics section - because that's what I'm interested in. I'm not interested in: right wing politics right wing conspiracy theories inflation gold oil [well I am interested in oil actually, but the Oil Drum is the place to read about oil] shopping cars kirstie & phil unemployed scrounger rants baby boomer threads - we know the arguments, live with it, suckers! Brown loses grip tax abuser of the week, especially when most rich folk pay as little of the stuff as possible George Soros share prices & a whole load of other off-topic rubbish. Frankly, if I want to find out about any of the above, I'll find a better informed source, thank you. I come to HPC because I'm a monomaniac about property. If some jumped up twit now accuses me of being narrow-minded I'll challenge them to a bout of general knowledge and beat them hands down. Quote Link to comment Share on other sites More sharing options...
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