The latest FSA mortgage lending data shows that gross new lending falls by 48% in the year to 2008.
The data for the final quarter of last year, shows that new lending peaked in Q3 2007 at £102 billion before declining to £45 billion in Q4 2008, leaving gross lending 26% lower in the quarter, and 48% lower than a year earlier.
Key statistics are as follows:
- The total value of outstanding loans is £1,200 billion, an increase of 3.5% compared to a year earlier. But quarterly growth continues to slow, with a Q4 2008 increase of just 0.25%.
- Loans to borrowers with an impaired credit history represented just under 1% of new lending in Q4 2008, compared to 3.2% a year earlier.
- While the number of new arrears cases had remained constant at around 54,000 each quarter since early 2007, the latest two quarters have shown sharp increases. Q3 2008 saw an increase of 10% to 60,000 cases, while results for Q4 2008 show an increase of 13% to 68,000 cases.
- With borrowers increasingly struggling to clear their arrears, the total number of loan accounts in arrears has been steadily increasing since early 2007. At the end of Q4 2008 there were 377,000 loan accounts in arrears, an increase of 36,000 or just over 10% since Q3 2008, and an increase of 31% on a year earlier.
- The proportion of the residential loan book that is in arrears, and hence not fully performing, rose to 3.37% at end Q4 2008, up 0.44% in the quarter and up 1.11% on a year earlier.
- The numbers of new possessions has grown significantly since Q3 2007, but the number of new possessions in Q4 2008 at 13,028 was actually 436 fewer than the 13,464 recorded for Q3 2008. New possessions in Q4 2008 were nonetheless 60% higher than a year earlier. For 2008 as a whole, the number of new possessions reached 46,750 which is an increase of 68% on the 27,900 recorded for 2007