Best Financial Markets Analysis Article The Council of Mortgage Lenders (CML) mortgage lending data released today shows a 49% crash in the number of mortgages granted to home buyers to just 516,000 which is the lowest number since the mid 1970's property crash. There were 32,000 house purchase loans in December, a decline of 5% from November and the lowest level since monthly records began in 2002.

Michael Coogan, CML director general, said: "The shortage of mortgage funding and reduction in the number of active lenders has reshaped the mortgage landscape in the space of a year. This low level of transactions is insufficient for the functioning of an efficient market.

"Measures are now in place to seek to restore the flow of funding to the mortgage market, but this will take time to feed through. Further action may still be necessary to increase transactions, stabilise prices and restore confidence."

The CML data supports that of the British Bankers Association BBA which saw the total amount outstanding contract from £524 billion to £496 billion.

However on a marginally brighter note mortgage lending for house purchases rose from record lows during December 2008, which implies that the flood of tax payers money amounting to more than £1 trillion, coupled with angry arm twisting pressure from both the government and Bank of England on the part or wholly nationalised banks such as HBUST, Northern Pebble, Bradford & Bunglers and RBF'd-up is starting to show at the very least a pause in the crash of the mortgage lending market, which helped to contribute towards a small bounce in the house prices for January 2009 that my next article will elaborate upon.

The indepth forecast for the UK recession in terms of GDP contraction is underway, to receive this in your email in box on the date of publication subscribe to my always free email newsletter.

By Nadeem Walayat
http://www.marketoracle.co.uk

Nadeem Walayat has over 20 years experience of trading derivatives, portfolio management and analysing the financial markets, including one of few who both anticipated and Beat the 1987 Crash. Nadeem's forward looking analysis specialises on the housing market and interest rates. Nadeem is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication. We present in-depth analysis from over 250 experienced analysts on a range of views of the probable direction of the financial markets. Thus enabling our readers to arrive at an informed opinion on future market direction. http://www.marketoracle.co.uk

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