Large decrease in lending for house purchased predicted for 2024

UK Finance, a trade organisation representing UK bank anticipates an 8% decrease in UK lending for house purchases in 2024 due to higher interest rates and household costs, impacting mortgage credit accessibility based on affordability. This trend is expected to result in reduced lending across all sectors and a rise in repossessions. However, a more positive lending outlook is projected for 2025. Mortgage arrears are forecasted to increase, and while the Bank of England held interest rates at 5.25% in November, the possibility of rate cuts remains uncertain. Despite challenges, UK Finance is hopeful for a turnaround in 2025, attributing the current lending limitations to household financial pressures likely to fade gradually.