1 Oct

Mortgage market slowing, BoE says

Mortgage market slowing, BoE says

The number of mortgages approved in August dipped to their lowest level in four months, new figures have revealed.

According to statistics from the Bank of England, there were 109,000 mortgages approved during the month - down from the 110,000 that property market analysts had anticipated.

This figure represents a significant downturn from July, when 115,000 mortgages were approved and is further evidence of a downward trend since November 2006 when the market hit a recent peak of 128,000.

The latest figures appear to confirm that the five interest rate rises since summer 2006 and the resulting higher borrowing costs are beginning to dissuade buyers.

Moreover, since these figures "predate the latest round in credit in markets" and the "Northern Rock saga", it is likely that further decline will occur in the coming months, according to Simon Rubinsohn of the Royal Institute of Chartered Surveyors (Rics).

He told BBC Online: "Rics' monthly housing market survey is showing a sharp drop in new buyer enquiries and we expect this to be reflected in a further fall in activity levels in the housing market over the coming months."


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