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Sunday 09th of January 2011
January 6, 2011    

Demand for house purchase mortgages plummets

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by Gill Montia
”Demand

Demand for house purchase mortgages fell “markedly” in the three months to December, lenders have reported, with the trend expected to continue over the current quarter.

According to the Bank of England’s latest Credit Conditions Survey, the decline reflected “a recent fall in house prices, a general weakening of sentiment towards the housing market and uncertainty over the economic outlook”.

Lenders also reported that funding for mortgage finance tightened somewhat during the period, as developments in the eurozone spilled over into the wholesale funding markets.

However, banks expect mortgage availability to remain broadly unchanged as they head into 2011, along with credit scoring criteria, but in the case of the latter, only for as long as the base rate stays put at 0.5%.

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