Autumn slump in housing market confidence By Sarah Davidson


House prices, gross mortgage lending and homeowner con- fidence all fell in September. Halifax recorded a monthly house price decline of 3.6% in September, a quarterly drop of 0.9%, resulting in an an- nual change of 2.6%. nationwide’s index show-


ed house prices in September edging up just 0.1% from au- gust to £166,757.the mutual put the annual rate of house price inflation at 3.1%, down from 3.9% in august and 6.6% in July with the three month on three month rate of change falling from 0.0% in august to -0.9% in September. mortgage finance also


choked in September with the council of mortgage


New investments by


Robert Sinclair director AMI


the last momentous month has seen the long awaited comprehensive Spend- ing review extend protec- tion for those facing arrears, challenge those on benefits and consign social housing to a local decision. this will extend opportunities for private buy-to-let, but with already limited bank fund- ing the opportunities may be lost. the debate over me- dium term mortgage funding is still off the political radar. Perhaps strangely, the Fi- nancial Secretary to the


Lenders’ gross mortgage lending figures showing a monthly decline of 1% to just £12 billion, 7% down year on year and the lowest Septem- ber volume since 2000. British Bankers’ associa-


tion statistics painted a simi- lar picture with gross bank mortgage lending at a mere £8 billion in September, 10.8% lower than a year ago. and with mortgage sup-


ply still stunted, homeowner confidence suffered a sharp fall in September. research from property portal, Zoopla. co.uk , said one in four hom- eowners now thinks property prices will fall over the next six months while nine out of 10 said home finance was no easier to come by in Septem-


treasury has been address- ing qualifications issues and labelled financial advisers with level 3 qualifications (cemap) as no different to mcdonalds shift supervisors! Yes, they aspire to a vocation- al qualification at the same “level”. if we are to be seen as credible and professional, it will be our actions in doing right by our customers that will define us. in the future, that will include not letting them borrow irresponsibly. at ami we continue our


work on the new regula- tory framework, having had discussions in Brussels, the treasury and the FSa. i’ve also been able to raise mort- gage issues with a range of influential mPs on the trea- sury Select committee. the mmr still has no defi-


nite dates for implementa- tion and i am still hopeful that the FSa is in listening


ber than it was three months before. despite the gloomy house


price numbers from Halifax, its chief economist, martin ellis, said: “the quarterly rate of house price decline is significantly slower than the quarterly changes of between - 5% and -6% that were seen in the second half of 2008. “it is therefore far too early


to conclude that September’s monthly 3.6% fall is the be- ginning of a sustained period of declining house prices.” But he added: “renewed uncertainty about the econ- omy and jobs has caused consumer confidence to fal- ter recently, dampening the demand for home purchase.” nicholas Leeming, com-


mode on this project. i have been criticised by some for saying positive things about the mmr team. i remain positive, in that they have consulted widely during their discussions.We have to hope that they now use that dialogue to deliver practi- cal conclusions that protect the vulnerable but keep the vibrant and innovative mar- ket that has served the vast majority of homeowners well over the last decades. the weeks that run to the end of the year will define our mar- ket for the next decade. the coming months will


also see the interest rate de- bate move back to the fore. the upward pressure on key commodity prices will continue. Large firms have squeezed as much as they can from their suppliers. thus the Vat increase will be passed on in prices and


mercial director of Zoopla, said this would feed through into further falls. “the ongo- ing mortgage drought has started to have a real impact on consumer confidence,” said Leeming. “optimism about the outlook for the housing market is dropping sharply.” david Smith, senior part-


ner at property consultancy, carter Jonas, agreed with Leeming. He said: “the con- cern is that statistics like this will further dent consumer confidence. With so many negative and positive vari- ables in the mix at present, it is almost impossible to pre- dict activity within the prop- erty market from one month to the next.”


the winter will cause fuel prices to rise again. So the inflation rate will come centre stage in the de- bate on whether Quantitative easing is needed to avoid double-dipping. Stagflation raises its ugly head. thus the monetary Policy committee, whose job is to control infla- tion, is more worried about economic stagnation. So we will see split votes in com- mittee, with less consensus. this cannot be good. ami remains encouraged by the gradual increase in the num- ber of active lenders focussed on using brokers. However the on-going consolidation of broker firms does give rise to some concerns.But it does show that there is still seen to be value in good distribu- tion firms and that is some- thing that in this economy we should stand tall and be proud of.


mortgage introducer NOVEMBER 2010 5


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