Mortgage approvals see first fall in six months

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Mortgage approvals fell slightly in February to mark the first decline since August 2016, according to the latest Bank of England Money and Credit figures.

Total approvals fell from 128,617 in January to 125,622 in February, but remain above the recent six-month average.

This dip follows four consecutive monthly increases for house purchase approvals, which hit their highest since February 2016 last month.

Remortgaging also declined in February, falling to 43,822 from 45,859 in January.

Jeremy Duncombe, Director, Legal & General Mortgage Club, commented: “Monthly fluctuations are typical of our housing market and today’s slight dip in mortgage approvals is testament to this. It is important that we aren’t distracted by these nuances and instead focus on the opportunity borrowers have to significantly save money on their mortgage deals in our current low interest rate environment.

“Overall, the market remains very much business as usual and this confidence is likely to continue even after Article 50 is triggered. Borrowers would benefit from getting in contact with a broker who would be able to provide guidance on how best to navigate the ever-changing market, and ensure they are making the most of the best opportunities and deals available to them.”

Richard Pike, sales and marketing director at Phoebus Software Limited, added: “The fact that lending has dropped for the first time since August could indicate uncertainty due to many factors including Brexit and how it will affect the economy. Lending is still fundamentally strong, but in an environment of uncertainty both in the UK and more globally, it will be interesting how these factors transpire into lending figures. Consumer sentiment will inevitably go up and down and so a take up of longer term fixed rates can be expected. Ultimately the underlying trend will be an upward one, as demand for people to buy housing or re-mortgage to secure a rate is met.”

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Written by: Houseladder