Mortgage Approvals Fifth Lower

Mortgage Approvals Fifth Lower.

Confirming our known fears, the British Bankers Association (BBA) has released figures this week for August suggesting that just short of 37,000 mortgages were approved by banking group members.

In issuing their release, the BBA suggested that this was a fall of 1/5^th i.e. 21% in the mortgages approved since a year ago and the lowest figure for 18 months i.e. going back to the start of 2015.

Comment

Despite the potential for interest rate falls and mortgages becoming cheaper, clearly there has been an impact during holiday season but more importantly confidence is lower given the EU referendum for the United Kingdom to leave the European Union i.e. Brexit.

The figures do not surprise us even though summer is traditionally a busy period for house buying. That said, there have been many predictions for property price falls so perhaps prospective purchasers are holding back slightly for lower interest rates and potentially lower purchase prices.

To counter that though, we have also seen various forecasts from estate agent associations and surveyors suggesting that property prices for the majority of the UK will increase each year for the next five years and whilst London and the south-east may be "flat lining" in 2016, forecasters certainly expect London property prices to begin to rise at national rates towards the back end of this year.