The British Banker's Association reported that U.K. mortgage lending was down 30% in March, to GBP13.7 billion ($26.08 billion), versus numbers recorded at the same time last year. Despite the dramatic fall in lending, market sources remain optimistic and said the trend is consistent with housing indicators signalling a bottoming out of the U.K. mortgage market.
But with unsecured consumer credit also continuing to weaken, housing market fundamentals continue to feel the fallout. Hometrack reported average home prices fell 0.1% in April, and are down 1.5% in 2005 year-to-date. Last week the U.K. department of Constitutional Affairs reported 26,000 mortgage repossessions, a 25% increase from the previous quarter and the highest repossession figures since 1995, according to market analysts.