A new report from the Council of Mortgage Lenders has shown a 20 per cent drop in the number of new home loans in Scotland . In the three months to April, 16,000 loans for house purchase were agreed, down by a fifth on the 20,000 agreed in the first quarter of last year. Although the figures are disappointing, they show that Scotland are dealing with the effects of the credit crunch far better than the rest of the UK.
Whereas new home loans dropped by 20 per cent in Scotland, the problem is twice as bad across the rest of the UK, who experienced a 40 per cent fall in new home loan approvals over the same period. One of the reasons for Scotland’s relative capacity to cope with the crisis is their lower house prices, with house prices in Scotland 25 per cent lower than in the UK.
The data also shows that the average Scottish borrower is less financially stretched than an average borrower elsewhere in the UK. The typical Scot borrows 2.87 times their income, with repayments accounting for 16.9 per cent of their income. Meanwhile, elsewhere in the UK, consumers are borrowing 3.14 times their income, with repayments accounting for 18.5 per cent of their income.
New Home Loans Drop in Scotland
Mon, 09 Jun 2008
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