Forecasts for mortgage lending and house sales for next year have both been revised sharply downwards.
And lending for this year will not be as high as had been predicted.
Yet the Council of Mortgage Lenders' newly revised gloomy forecasts have been described by industry commentators as over-optimistic.
The CML predicts that next year there will be just 825,000 housing transactions – 75,000 less than previously forecast – and fewer than the 852,000 that it estimates for this year.
The CML now expects gross lending for this year to total £138bn, as against its prediction made only six months ago of £150bn.
For next year, it is forecasting £133bn gross mortage lending, but significantly, it expects that net lending will be just £5bn – less than half the £12bn it originally forecast, and less than the £9bn net lending it expects for this year.
The revised forecasts come despite a 5% monthly rise in gross mortgage lending in November of £13bn.
The CML is also predicting more repossessions next year, at 45,000 – up from an estimated 37,000 this year.
CML chief economist Bob Pannell said: “We have pencilled in a broadly flat picture for both mortgage lending and property transactions.”
Charles Haresnape, of Aldermore Mortgages, said the CML’s forecast could be on the optimistic side, with ‘headwinds’ in the economy a threat.
Richard Sexton, of national valuation firm e.Surv, said: “Predictions of a flat market now look optimistic.
“There certainly won’t be a great deal of scope for banks to increase their loan books.
“The rate at which banks lend to each other, LIBOR, is creeping ominously upwards to 1.05%, and they will look to pass these costs on to consumers, which means mortgage rates will rise and high loan-to-value lending will fall.”
David Whittaker, managing director of Mortgages for Business, said of November’s gross mortgage lending: “Recent improved lending figures are due to lenders needing to hit targets before the end of the year rather than a significant improvement in the residential housing market, so anyone hailing this as a new dawn is as misguided as the chap who suggested a single European currency was a sensible long-term venture.”
Comments
Right that's all my Christmas shopping done this year. I've just battled the hoards of other busy shoppers in Currys for all my latest state of the art must have electrical goods ..................
....................can't wait to see how much I would of saved if I had bought online, and more to the point waited until the January 65% price cut sales.
What is it with some so called "property professionals" not seeing that high property prices causes lower transaction levels?
Definition of both communists, HPC’ers, and Happy Chappy
Someone who has nothing, and desperately wants to share with everyone else
"The top 1000 richest people in the uk could finance that much money from their back pockets and not miss it." and your point is?
For next year CML is forecasting £133bn gross mortage lending, predicting next year there will be just 825,000 housing transactions.
The top 1000 richest people in the uk could finance that much money from their back pockets and not miss it.
Get real Brit1234, Rantnrave, and all the HPC idiots. Go spill your bile on a website where it is welcome, that's hpc forum.... hurry along now!
Brit1234 says "I think" before posting twaddle, then writes "I am one of those likely to be cherry picked".
Obviously a self opinionated idiot.
What sort of fool reveals themselves to be a selfish, uneducated producer of toxic prophecy to justy outcomes that may (or may not) benefit them, but to the absolute misery of millions of other people?
Oh yeah! 2 people like this..
Brit1234 and Adolf Hitler.
What a guy....... go back to HPC forum, you are stinking up this room.
I think it is very unwise to buy now with house prices falling so quickly. You would simply lose so much of that hard saved deposit, far better to wait and buy cheaper.
As for mortgage lending being likely to get far harder, I completely agree. However that puts further downward pressure on prices which is good and I am one of those likely to be cherry picked.
FTBs keep saving and enjoy the 2012 falls.
@Brit1234 and all other HPCers
Only if the lending is there will any significant price drop enable you top achieve your heart's desire - buying at the price you have been waiting for.
You could have a 3 bed semi at £40K but unless that is the deposit you have saved so you become a cash buyer which without funding is the only way to buy anything, you will not be able to buy.
I have said it befoe in another thread if you need to buy and want a home rather than an investment then don't delay too long.
Things are going to get a whole lot worse next year and well into 2013 to the extent that house prices dropping 20% - 30% (which wouldn't surprise me especially if the eurozone does collapse) could be the least of ourt worries.
I don't see borrowing for house purchases becoming any easier, in fact I thinkit could become a lot harder. Average deposits are going to be at least 20% and interest rates eventually are bound to rise.
Banks will continue to cherry pick - if you need a home I'd get on with buying it now if I was you.
I think we are going to have double digit falls next year. The sooner prices get back to affordable prices. It will mean first time buyers come back, chains will be completed and estate agents will get lots more commission from increased transactions.
There ids no may or may not about it.
The Idiot calling himself Rantnrave gets some sort of strange pleasure by provoking reactions on the site of what he deems 'the enemy'.
2 recent quotes from this idiot on the follow on from the Henry Prior blog
Rantnrave said: I'll get flamed for this, but over on HPC, your articles Henry are held in high esteem.
Rantnrave said: Rick - I'm all for a HPC, for sure (for those who hadn't guessed).
A complete waste of time wind up merchant. He should be banned form here. He is like a giggling schoolboy Liverpool supporter writing silly notes on a Manchester United supporters forum to get reactions.
It is stupidity in extreme
Mr. Rant may, or may not, be an idiot.
Does he know where to put apostrophes?
"The idiots influence on EA's themselves"
Hard to know where to begin.
if you ban the idiot known as rantrave then we will miss priceless twaddle like....
"What if we ban loans to buy property"- that laugh has to be worth thesilly little twit being allowed to stay?
I do however agree hes a complete pillock!
I bet the anon posters employer isn't aware of how much time he devotes to working out statistics on rantnrave :0)
Okay,
Look at it this way then.
The idiot posting as Rantnrave is responsible for 13% of the 155 total posts on todays stories.
The idiot has an opinion on every thread that drew comments today.
Disproportionate to:
a) The idiots knowledge of the EA business
b) The idiots influence on EA's themselves
c) The idiots influence on money markets
This idiot must truly believe people are interested in his opinion and sit nodding agreement at his posts.
He has a website especially for him. HPC.
I bet his employer isn't aware of how much time he devotes to cutting, pasting and investigating to pile his rantings on us.
Okay........
Presumably however, EAT posts news items with the ability to comment on them, for the purpose of people commenting on them.
I know Rantnrave has a different point of view to many of you on here, but his posts are genuine, and from what I've seen, polite.
He may be accused of 'over posting', but at least they don't tend to be abrasive or rude, which is what I find to be the major 'put off' from the comments on many of these items.
......anyway - I am just a visitor to this site and not an EA. I guess it's up to you lot what you want your site to be like.
The reason this idiot posting as Rantnrave draws such comments like that from EA's (and others) is because if EAT reported EA's seem to prefer silver cars to black ones, this idiot would make a comment on it.
This idiot posts on just about every thread, sometimes 4 or 5 times, over a week it runs to 100's of posts. It is turning into his own personal show.
Vote now!
This idiot banned or stay..
I vote ban him
@ NTB Dan
I'm not sure what you disagree with in rantnrave's post. I think his point about LIBOR is a fair one.
rantarve- you need to get a job and perhaps a life. How sad.
Here we go again - another bunch of 'pundits' making (correcting?) forecasts. They know no more than ohers about the detail of the future. Reminds one of what I beleive Edward Heath once said - "events dear boy, events"
e.g.
There was a man sitting at the bar staring at his drink when a large, trouble-maker steps up next to him, grabs his drink and gulps it down in one swig
"Well, whatcha' gonna do about it?" he says, menacingly, as the man bursts into tears
"Come on, man," trouble-maker says, "I didn't think you'd CRY. I can`t stand to see a man crying."
"This is the worst day of my life," the man said. "I'm a complete failure. I was late to a meeting and my boss fired me. When I went to the car park, I found my car had been stolen and I don't have any insurance. I left my wallet in the cab I took home. I found my wife with another man and then my dog bit me."
"So I came to this bar to work up the courage to put an end to it all, I buy a drink, I drop a capsule in and sit here watching the poison dissolve; then you show up and drink the whole thing!
But enough about me, how's your day going?"
Good to see the significance of LIBOR rather than BoE rates being given coverage.
No surprise there then.
Do I hear "doom, doom" from the HPCers?
An estimation that a precition was previously calculated incorrectly...let me change it, please!! How about trying it down the betting shop, mid-race?
What's to say this 'amended' prediction is not going to be adjusted in the coming months again (either way).
Nonsense.
Definitely time to retire. Shame about the annuity rates though.