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House building halted as buyers struggle to get mortgages, says FMB

May 28, 2008 by admin  
Filed under News, News-Mortgages

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The number of new houses being built in the UK has dropped in recent months because property developers have backed out of projects as people struggle to find mortgages to buy property, according to the Federation of Master Builders (FMB).

Lenders have been tightening their criteria since the credit crunch hit last summer and the effects are now being felt in the property market as people cannot afford to buy houses if they have been turned away for a mortgage.

Brian Berry, director of external affairs at the FMB, said that before people began to have difficulties in obtaining mortgages, there was a shortage in housing supply due to rising demand

He cited the causes of the increase in demand as being an “increase in population; people living longer; people living on their own because of divorce or lifestyle choices; and an aging population”.

Mark Clare, group chief executive of Barratt Developments, recently told Inside Housing that the credit crunch is hindering new development projects and could lead to a “severe undersupply” in housing.

Tags: lifestyle choices, mortgage, lifestyle, house builders, Barratt, increase, Mortgages, divorce

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