UK mortgage approvals fall for third month
The British Banking Association (BBA) announced that loans for house purchases fell to a new 19-month low of 36,997 from the revised previous figure of 37,672 a month before and very slightly below the consensus estimate of 37,100.
Despite mortgage rates falling since the start of the year, mortgage approvals in August were down 20% since January and down 21% year-on-year.
However, the BBA's high street banking statistics report revealed gross mortgage borrowing grew 1% to £12.4bn in the month compared to the same month last year.
The data was collected before the Bank of England reduced interest rates to 0.25%.
BBA chief economist Dr Rebecca Harding said these statistics "pointed to a softer housing market, strong consumer credit and slightly weaker business borrowing" and gave an indication of some of the underlying pressures that led the BoE's monetary policy committee to make its rate cut.
"Mortgage borrowing is growing at a slower pace than it has for the last few months reflecting both the slowdown in housing market growth after the April spike and broader trends in the sector," she added, with approvals having fallen from 39,787 in June and 41,676 in May and the 23-month high of 46,335 in January. ■