Mortgage Lending Falls Dramatically After Stamp Duty Holiday Ends

The Council of Mortgage Lenders (CML) has reported that the number of mortgage applications on properties valued between £125,000 and £250,000 fell by 70% in April 2012 compared to March 2012.

London, United Kingdom (prHWY.com) July 30, 2012 - The Council of Mortgage Lenders (CML) has reported that the number of mortgage applications on properties valued between £125,000 and £250,000 fell by 70% in April 2012 compared to March 2012.

From March 2010 the Government had made these properties exempt from the 1% stamp duty tax in an effort to boost sales at the bottom of the property ladder. This tax holiday ended on March 31 and saved buyers an average of £1,800.

Paul Ribbons from the Paul Ribbons Partnership says;

"The fall in mortgage lending following the stamp duty holiday was inevitable as with all government schemes to stimulate the economy there will always be a rush for buyers to get in before the deadline. Once this has been and gone there will be a drop of buyers, which distorts the figures and reminds us of the reason the government did this in the first place.

My concern is as the euro-banking crisis escalates this may cause another credit crunch similar to 2008. It has been mentioned by EU finance ministers that this is worse than the Lehman Bros failure and we all remember that.

I still believe that the level of any price falls will be determined by area, as even though there is a decline in mortgage apps and also a potential credit crunch, prices should remain stable for this year."

According to the CML, the number of mortgage loans offered to first-time buyers between March and April 2012 fell buy nearly 50%.

About Paul Ribbons

Paul Ribbons has a unique and very lucrative strategy that has made him, and his delegates, wealthy from property investment. Paul has been involved in over 500 below market value (BMV) deals. He has a simple and effective strategy of buying property from the open market, distressing them and reselling them at auction for profit. Everyone can do it, and in his book and via his courses, he tells the story of how he came across his simple formula of making money.

Read 'The New Property Manifesto' at http://www.paulribbons.com.

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Categories: Real Estate

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