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UK home mortgages slip in Dec

(LONDON) British customer-owned lenders approved fewer loans for house purchase in December as falling house prices hurt the confidence of prospective buyers, a report by the Building Societies Association said.

Mortgage approvals fell 20 per cent from a year earlier to £pounds;4.1 billion (S$11.5 billion), said the BSA, which represents 59 building societies in the UK. On the month, approvals declined 9 per cent.

The UK’s decade-long property boom is withering as higher borrowing costs and forecasts for slowing economic growth deter buyers. The Bank of England cut its benchmark interest rate for the first time in two years in December.

House prices declined for a third month in January, Rightmove plc said yesterday. December was the worst month for the housing market since the aftermath of Britain’s last recession in 1992, the Royal Institution of Chartered Surveyors said on Jan 16.

Building societies attracted a record £16.1 billion pounds in savings last year as consumers withdrew deposits from Northern Rock plc in the first run on a UK bank in more than a century, the BSA said.

 

Source: Bloomberg (Business Times 22 Jan 08)

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