House for rent in Hanoi, Apartments for rent in Hanoi

There were 47,312 approvals last month, up from 44,124 in June but down on the 51,000 approvals recorded in the previous six months. Mortgage approvals are a good indicator of near term trends in lending to home buyers and much hope has been pinned on the recently announced Funding for Lending scheme to inject more and cheaper loans into the market. Launched at the beginning of August, it will be months before it begins to have an effect, according to the Bank of Englands executive director for markets Paul Fisher. It is first time buyers who are worst affected by the lack of lending, according to Richard Sexton, director of e.surv chartered surveyors. 

They are bearing the brunt of the savage squeeze on credit which is blighting to the economic recovery. Its becoming much more expensive for banks to access lending funds, and that is hitting lower income borrowers the hardest because banks see them as higher risk, he said. May and June were quiet months, punctuated by lots of bank holidays, so the rise in gross lending in July actually camouflages the weakening state of the lending market. After staggering slowly towards a recovery, the double dip recession has undone much of the progress the mortgage market has made. It is slipping back into trouble again, he explained. He pointed out that loans for home purchases are almost 6% lower than July last year, and loans to borrowers with small deposits represented less then 10% of all lending in August. 

Cash rich foreign investors, wealthier domestic buyers, and buy to let landlords are all less dependent on bank finance, so are having a field day. They have been able to pile into cheap property while first time buyers are left in the lurch by banks high deposit requirements and challenging lending criteria, he added. Paul Hunt, managing director of Phoebus Software, believes that the market will brighten as the Funding for Lending scheme kicks in and lenders become more competitive. Increasing competition between lenders is driving a slew of new better value mortgage products.

Recently we have seen mortgage sales from lenders and rate cuts from building societies. These are hugely positive steps that reflect the change in attitude of lenders who want and need to attract customers for the first time in a long time, he said. As more lenders offer competitive rates and as the governments Funding for Lending scheme kicks in, borrowers will finally get the support they've been crying out for, he added. Figures from the Building Societies Association suggest that lending is increasing. Its data for July shows that lending by building societies and other mutuals is rising, up 14% on the previous month and up by 44% compared to July last year. Mutuals took a 24% market share of gross lending in July, up from 17% in July 2011, and had a 21% share of lending in the first seven months of the year. The number of mortgages approved by mutual's, which represent the future completions pipeline, was up 32% in July compared to the same month last year. Mutual lenders approved 26% of all mortgage loans in the UK in July, and 24% in the first seven months of the year. Mutuals are currently enjoying a sustained increase in lending activity and that has been growing strongly on a year on year basis for some time now, and in July gross lending rose again by a healthy 44%.

 At the same time lending by banks fell by 9% in July,? explained Adrian Coles, director general of the Building Societies Association. As a result mutuals continue to take market share, up to 24% in July, well above the 17% figure for the same month on 2011. Approvals by mutuals were also up in the month and this means that this trend of increased lending is likely to continue,? he said. He also pointed out that the Funding for Lending scheme has not influenced these figures and may not start to for a number of months yet. 

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