Estate agents have reported that enquiries have dropped by a quarter as home buyers abandoned plans to move house following the recent turmoil. The high profile nature of the Northern Rock case has led to uncertainty as people are concerned about all types of mortgage lending.
Chancellor Alistair Darling told the Labour Party conference that the situation was an example of how globalisation could affect the UK mortgage industry.
He said: “This international instability is affecting not only us, but countries across the world, which is why we need to work together and deal with these problems now. Let me be very clear, the financial services industry in this country is strong. It has an international reputation. It is, and will always be of vital importance to this country. We are world leaders, and we want to keep it that way. Globalisation, whether it is in the financial services, in business, in energy, has transformed the scale of the challenges we now face.”
One agent reported that enquiries dropped after the announcement and its central London offices had its quietest weekend of the year so far, and comparisons to other property websites showed that there was a pattern in the industry.
Rob Clifford, chief executive at Mortgageforce, commented: “The mortgage intermediary market can prosper at times like this when conditions are tight, but thankfully our sales were up for August and are looking good for September.”
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