Tuesday, 30 September 2008

Twisted logic and distorted facts of the day* (2)

Again, from the BBC:

New mortgage lending collapsed in August, according to the latest figures from the Bank of England. Banks and building societies lent an extra £143m in home loans last month, just 5% of July's lending figure and only 2% of the lending in August 2007.

Yes, we know that the number of homes bought and sold each month is down from its long term average of about 100,000 to 30,000 or something, but if you divide £143 million by typical price £143,000, that would mean only 1,000 homes were bought with a mortgage, i.e. first time buyers.

Ah ... I see what they did there ... gross mortgage lending was down from £34 billion in August 2007 to £20 billion in August 2008 (page T20 of the original Bank of England report). There's another table on the same page that looks at net lending, i.e. new advances minus repayments, that's the figure that's down £143 million, which is probably within a margin of error of one or two hundred million anyway. Twats.

* Actually, the article came out yesterday, but it's taken me a while to battle my way upstream to the original source of the complete misunderstanding.


Anonymous said...

If I may say, that was very well observed.