Since the turn of the year, the overall mortgage stock has started to rise as higher demand feeds through and is 1.0% higher than a year earlier. This contrasts with much of 2013 when new monthly borrowing was more than offset by elevated capital repayment (in part reflecting homeowners switching lenders). Approval numbers have moderated, which the BBA attributes to the new application regime, and as announced in the LMS report this morning, remortgage approvals are considerably lower.
Richard Woolhouse Chief Economist at the BBA said:
“Our figures indicate that the heat appears to be coming out of the housing market. These are the first mortgage approval figures we have seen since the introduction of the Mortgage Market Review, so it is significant they have fallen for the fourth month in a row. This is being driven by a drop in remortgaging and people borrowing against the value of their homes.
“There has also been a welcome expansion in business lending this month bolstered by borrowing from the energy sector.”
Mortgage borrrowing up 26% in May: BBA
Gross mortgage borrowing of £11.1bn was 26% higher than in May last year, according to the BBA Monthly Statistics release out today.
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