This is where we see the true nature of the UK credit crunch. UK banks really pulled back on the average size of approved mortgages. The average size of a mortgage peaked back in June 2007 at ₤160,000. In August 2008, that number was down to ₤130,000 - a fall of 18 percent. In fact, the fall in the average size of a mortgage is far steeper than the the decline in house prices. This suggests that banks are asking for much higher deposits.
This simply suggests that banks are returning to more prudent lending practices. In this sense the credit crunch is a welcome and healthy phenomenom. So please, more crazy plans to revive the housing market; we don't need them.
3 comments:
What's the source?
Is this average all mortgages including remortgages and second mortgages or is this just for FTBs?
British bankers association. Click on the chart, and you will see the source in the bottom lhs corner.
It is from table 5 of the BBA historical data. It includes lending secured on dwellings.
Alice
I suspect that it will be end up below £100,000 before this crash is done!
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