Mortgage approvals decline 17%

Mortgage approvals declined by 17% to 48,198 in January, according to the Bank of England.

Not only is this below the 58,223 loans recorded in December, but it is also below the previous six-month average of 55,924.

Approvals for remortgaging (23,611) were also lower than in December (27,322) and lower than  their respective six-month averages (27,226).

Meanwhile, net lending secured on dwellings increased by £1.5bn, which is above the December increase of £1.2bn and the previous six-month average of £1bn.

Consumer credit increased by £0.5bn, above the previous six‑month average of a net repayment of £0.2bn, and also above December’s net increase of £0.3bn.

The statistics follow those from the Council of Mortgage Lenders, out last week, which reveal that

gross mortgage lending declined to an estimated £9.1bn in January, which is a 32% fall from £13bn recorded in December and a 21% fall from £11.5bn in January 2009.

The CMl insists that a decline is typical between December and January, but reveals that this is the lowest monthly total since February 2000 (£7.9bn) and the lowest January total since 2000 (£7.4bn). The CML claims that the larger than average drop confirms its view that house purchase activity was boosted in December by a number of borrowers trying to complete their purchase before the end of the year to take advantage of the Stamp Duty holiday.

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