Industry figures report that net mortgage lending by several building societies dropped from 1.418 billion pounds to -491 million pounds from January last year. The gross lending of Building Societies was 4.088 billion same time last year while this year it is at a dismal 1.570 billion pounds.
The fact that the mortgage lending is so low is not very surprising because of the sad state of the housing market. However, repayment of existing loans surpassed new lending according to director general of the BSA, Adrian Coles. Prospective buyers are still not entering the market though house prices are falling. Lenders are also skeptical on giving loans in recession times and the current unsteady market will produce serious concerns of long term funding availability.