Mortgage approvals head south

Approvals for home loans continued to dwindle in March, new figures have revealed.

The Council of Mortgage Lenders (CML) has revealed that approvals for home loans fell one per cent against the previous month to just 46,500.

Year-on-year that amounts to a 48 per cent fall in lending and serves as an indication of the tightening of the mortgage market in the current credit crunched climate.

Gross mortgage lending totalled £75 billion in Q1 2008, compared with £83.9 billion in the first three months of 2007.

Offering little hope for a recovery in the market, CML director general Michael Coogan said: "House purchase transaction volumes will continue to deteriorate in the coming months as recent approvals data from the Bank of England has shown."

His comments were echoed by Sean Gardner of MoneyExpert.com, who added that house buying is now at its lowest level since 1975.

Hinting that people searching for flats for sale in London might be better off in the rental market, Mr Gardner added: "First-time buyers and people renegotiating their mortgage for the first time will be worst affected."

News posted on 13th May, 2008