Mortage Lending up 0.8%

Mortgage lending up 0.8% to July

Thursday, August 23, 2012

Published by WARREN LEWIS

BBA have today released their report about the high street banks’ lending, showing that mortgage lending was up 0.8% in the year to July.

The outstanding level of unsecured borrowing from the banks has contracted by 2.9% over the year to July. Within that, credit card lending rose by 3.6%, so it is a contraction of 7.3% in other loans and advances which drives the overall decline. Cash ISA inflows continue to be strong this year as households have looked to accounts paying better rates of interest,
leading to a rise in all personal deposits of 5.4% over the year to July.

Gross mortgage lending of £7.1bn in July was below the recent monthly average and reflected continued low levels of activity in the housing market. Historically, the difference between gross lending and capital repayment produced significant net lending each month. However, with declining levels of gross lending and a high capital repayments resulting from low interest rates, net lending has reduced to comparatively low levels.

Mortgage approvals for house purchase in July were 17% lower than a year ago, though there was an upturn in demand from June.

The average house purchase approval stands at £161,100 but due to expanded reporting within one banking group since the turn of the year, this cannot be directly compared with earlier trend figures. Numbers of remortgaging approvals were some 41% lower than in July 2011 and approvals for other secured lending were 25% lower.

New spending on credit cards of £6.9bn was below the recent monthly average and continues to be more than offset by repayments. Consumer demand for high street bank loans and overdrafts remains weak and the repayment of unsecured personal loans continues to outweigh new lending. Individuals’ outstanding loan amounts are now almost half of what they were at their peak in late 2007/early 2008.

BBA statistics director, David Dooks said:

“We continue to see the household sector increasing deposits and repaying debt. High street bank ISAs continue to attract strong personal deposits while repayments of both mortgages and unsecured lending have grown strongly this year as households seek to reduce borrowing and borrowing costs.

“Companies are reluctant to borrow or invest new funds while domestic and international trading activities remain subdued or uncertain. With larger firms also using alternative funding from corporate bonds, bank borrowing levels are contracting.”

Nick Hopkinson, Director of PPR Estates, said:

“Bank lending for mortgages remains effectively closed to everyone who really needs it. Huge deposits and perfect credit histories remain essential ingredients for anyone brave enough to be buying a house with a mortgage at the moment. Also, the announcement that one of the biggest high-street lenders is increasing its mortgage costs to existing borrowers will be a further blow to many struggling home owners. This is an ominous sign, indicating that real borrowing costs have disconnected from the Bank of England base rate and are moving towards 5%-plus in the near future for most mortgages. House prices face an uncertain autumn and are very likely to fall further rather than stay still based on the prevailing economic winds.”

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Bank Holidays in 2012 are the Perfect Time for Open House Viewings, say Property Property Property

This year the UK has seen some terrible summer weather, playing havoc with school holidays and picnic plans for many families. But for homeowners looking to sell their property, the bad weather on a bank holiday is the perfect opportunity to entice potential buyers in to the warm and dry.

London Property

London Property

Quote startBy being flexible with viewings, vendors can ensure they don’t miss out on that all important asking price offer from someone who can only view at weekendsQuote end

22 August 2012

In the search for a new home, viewing properties as a family can be tricky to organise. Usually one parent will have work commitments, the kids can’t take a day off school and some estate agents still won’t conduct viewings on a weekend. Usually kids aren’t involved until the second or third viewings, and in some cases children won’t even see their new home until the day they move in.

Christopher Marriott of thinks open houses are fantastic way to show case a property. “Conducting an open house style viewing is a trend that’s catching on with Estate Agents. It’s a much more flexible way for customers to view a house on the market because they can turn up whenever they like throughout the day and can look around freely, with the agent there simply to offer advice.” Christopher has worked with property in London for many years and adds “Holding an open house on a bank holiday means that families can visit all at the same time as it’s likely everyone will be enjoying the day off together. There’s no rushing about to keep an appointment and it’s also more convenient for the vendor.”

In the UK, rents have risen considerably in the last year, and lending has become a little more flexible to help first time buyers, so buying a property is starting to look more appealing. For some families, a quick move is essential once the decision to sell has been made. For anyone desperately needing to downsize or re-locate, being creative with the marketing of their property is the best way to achieve a quick sale.

Christopher comments “We have thousands of properties for sale and for rent in London on our website, which offers such a good choice for buyers, but on the flip side it means vendors have competition out there. By being flexible and creative with viewings, vendors can ensure they don’t miss out on that all important asking price offer from someone who can only visit at weekends”

Traditional office openings hours are fading away. With many high street stores now open until 6pm on Sundays, it’s time for the estate agents to catch up. Online agents and property portals are open for browsing 24 hours a day – is it time for the properties for sale to be open all hours too?

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