Tweet
The number of mortgages approved for house purchases fell to a record low in November, despite the 1.5% cut in interest rates at the start of the month, the British Bankers' Association (BBA) said today.
Just 17,773 loans were approved for homebuyers during the month, down from 20,767 in October and 61% below last November's figure of 44,315.
The average value of mortgages has also fallen sharply since last year, as house prices have tumbled and lenders have restricted maximum loan sizes.
In November, the average loan for a house purchase was £116,700 - a drop of almost £12,000 since October and well below the average of £159,600 last June when the housing market was nearing its peak.
The BBA said the 1.5 percentage point cut in the Bank of England base rate, which brought interest rates down to 3%, had prompted November's slowdown in mortgage activity.
The BBA's statistics director, David Dooks, said the cut had "caused lenders to reassess product ranges and borrowers to reconsider future borrowing costs".
He added: "Volumes of mortgage approvals reached new lows and, with house prices still falling, the encouragement of lower costs had not filtered through by the month-end, largely because people remain concerned about the impacts of the rapidly slowing economy on their personal finances."
More details soon ...
guardian.co.uk © Guardian News & Media Limited 2008 | Use of this content is subject to our Terms & Conditions | More Feeds
More...
