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No end in sight to the tightening in mortgage lending standards

The decision by three major lenders to withdraw their range of 100% to 125% mortgages will have only a limited direct dampening impact on the housing market, since the take-up of these loans has been low. However, to the extent that these moves reflect growing risk aversion among both lenders and borrowers, they support our view that the housing market adjustment is unlikely to be short.

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