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09 June 2023

UK mortgage approvals fall to 3-yr low

By Agencies


British mortgage approvals for house purchase fell for a fifth straight month in November to hit their lowest level in almost three years, providing further evidence of a slowdown in the housing market.

Bank of England data on Friday showed mortgage approvals -- a lead indicator of the health of the property market -- fell slightly more than expected to 83,000 from an upwardly revised 89,000 in October.

That was the lowest since January 2005 and not far from the series low of 77,000 hit in November 2004.

Mortgage lending growth remained subdued but came in above forecasts at 7.78 billion pounds, having hit a two year low in October at 7.66 billion pounds.

A weaker than expected rise in consumer credit meant total lending growth eased to its lowest since July 2005.

The figures add weight to a growing body of evidence that the housing market is running out of steam and that tighter global credit conditions are making it harder to borrow.

Evidence of continued weakness in the housing market may encourage speculation the Bank of England will follow December's interest rate cut with another cut next week.

A quarterly survey of credit conditions published by the Bank earlier this week also highlighted tougher lending conditions for both households and businesses. (Reuters)