"The burst of lending in the first part of the year was merely a smokescreen for the underlying weakness of the mortgage market, and with the stamp duty deadline rush no longer bolstering figures, lending has fallen back to earth with a thud. As the crisis on the continent worsens, banks and building societies are looking to consolidate their balance sheets ahead of new lending, and it is first-time buyers with small deposits that are bearing the brunt of this conservatism. While there is certainly underlying appetite for house purchase, prospective buyers are not just contending with a chronic lack of mortgage finance, but a difficult labour market and the re-instated stamp duty tax - and this is holding back the housing market outside the boundaries of the M25."
"London’s market remains at odds with the national picture. Cash rich buyers - immune to the effects of the ailing mortgage market – are looking to protect their wealth from financial turmoil abroad, and the competition means quality homes are selling incredibly rapidly in prime parts of the capital. We’ve seen prices rise by 7% already this year in sought after parts of London – and barring the short-term inconvenience the Olympics is likely to cause – this trend will continue."