Mortgage Market to Fall By 80%
Nationwide expects that the mortgage market will fall this year by 80% to only one fifth of its value.
The largest building society in the UK, Nationwide lent out less than half of the money they did a year ago, with only £1bn worth of new mortgages, compared to £3.6bn last year.
The society reported an 11% rise in pre-tax profits to £374m, but underlying profits fell by 18% to £322m.
Nationwide also said it expected house prices to continue to fall in 2009 through 2010. However, because of Nationwide’s decision to hold to liquidity and make safer, lower yield investments during the credit crunch, their key balance sheet ratios are stronger today than they were six months ago.