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Mortgage nose dive

Mortgage lending fell by 29% this January, as rising taxes and Government spending cuts took their toll on consumer confidence, reports the Press Association.

According to the Council of Mortgage Lenders only 28,500 loans were granted during January - the lowest level since February 2009 and 29% down on the previous month.

Michael Coogan, CML director general, said: ‘Pressures on household budgets have been increasing both in terms of take-home pay, and indirect tax measures such as the VAT increase and recent inflationary pressures, so we were expecting a fall in transactions early in the year, and a flat mortgage market underpins our forecasts for 2011.’

There were also fewer first time buyers on the property market, with only 10,500 people buying their first home with a mortgage – the lowest figure since February 2009.

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