The UK's struggling housing market received some good news this month; the number of mortgages taken out had risen by 7 per cent raising the total to £18.7 billion as opposed to Septembers 'weak' £17.5 billion. Even with the total figure rising from last month, it was still just under 45 per cent less than October last year which was set at £33.38 billion.
There was a decrease in the number of houses being built by a little more than a third in the last quarter which comes as bad news for house builders. The number of houses built in July, August and September had fallen to 22,000; this was the lowest number since records began in 1980. The number was even worse for the private sector as it seen a decrease of up to 55 per cent on new houses started this year.
Just because the number of mortgages being taken out is increasing and the Bank of England interest rate has decreased, it does not mean we will climb out of this recession. House prices are still falling and more and more people are feeling the repercussions of the credit crunch and simply cannot afford to move or may be at risk of losing their job. It is a good sign for the economy but it will take time to build our way out of the recession.
The economy is heavily relying on the government to release their Pre-Budget Report so they can release permanent steps for lenders to follow and encourage them to borrow more money.
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