A property meltdown loomed yesterday as new figures showed mortgage completions at near record lows and commercial property values falling across the country.
The Council of Mortgage Lenders (CML) said loans for house purchases rose by 4 per cent in May to 52,700, up from 51,000 in April, but were 44 per cent down on last year.
The figures chime with data from the Bank of England at the start of last month which said mortgage approvals in April sank to record lows of 58,000.
CML director general Michael Coogan predicted that the number of mortgage completions will drop off further in the coming months.
“Lending levels continue to be lower than last year and any recovery is still some way away, with little sign of the special liquidity scheme increasing the flow of funds to the industry or lowering the cost of funds as hoped,” he said.
While the housing market worsens, driven by the lack of mortgages available to borrowers, the gloom is gathering in commercial property as well.
Research out yesterday from property agent CBRE said the value of offices, retail and industrial space across Britain fell 1.3 per cent in June and is 18.5 per cent lower than this time last year.
Recently there has been talk that the slump in commercial property may be nearing its end.
But this data shows the country could be entering a second phase in the current downturn as rents continue to fall, tenant demand dries up and job losses grow.