Number of new mortgages fall
There are growing fears that Britain’s housing sector could be heading for a painful slowdown as the credit crunch affecting the banking sector spills over into the wider economy.
Recent figures released by the Building Societies Association show that the value of mortgage approvals for January nose dived by 25% to £4.168bn.
These figures are the strongest signs yet that the crisis in the credit-market has started to affect the mortgage market and will only add to the stain that homeowners have been facing in recent months.
The credit-crunch as impacted on all areas of the financial sector right up to the Bank of England Governor, Mervyn King, who came under heavy criticism for his handling of the crisis to hit Northern Bank as well as the credit-crunch.
The Bank of England has announced that it is now willing to offer £10bn bail-out money for struggling banks, which is a welcome move, however many in the banking sector are angry that the Bank of England was so slow to intervene.
The problem for borrowers is that banks are also trying to recoup many of their losses from the credit crunch which is only adding to the borrowers’ woes.