UK Housing Figures Confirm Market in a Slump

UK Housing Figures Confirm Market in a Slump

Housing figures from the month of February confirmed the market has little chance of making any rebound before the end of 2011. Lending and approvals combined to put a nail in the proverbial slump coffin. Howard Archer, chief economist at IHS Global Insight, discussed the unstable conditions of the current market.

He said: "The housing market clearly is still very weak which does not bode well for house prices. On balance, we expect prices to fall by around 5pc in 2011."

The Bank of England along with the Council of Mortgage Lenders provided convincing evidence of a market which continues to struggle. Data from the month of February indicated approvals are consistently lower than need be. They totaled 43,000 for the month, up from a two year low of 41,000 in January. That’s a drop of almost 15% year on year.

Net mortgage lending totaled only 500 million pounds for the month of February - its lowest point in 36 months. The CML reported gross mortgage lending was stagnant at 9.5 billion pounds for the month.

CML chief economist, Bob Pannel, commented on the housing market in general, saying: "There is little in the latest batch of market data that would cause us to revise our market forecasts for 2011, and nothing that alters our underlying view that this is going to be a challenging year for households and the housing market. The housing market remains stuck in a rut."