" Even though some borrowers may be tempted to take action before rates rise again, the threat of a ‘no-deal’ Brexit has many customers nervous."
Mortgage approvals also fell in July, to 65,000. This is close to their average over the past six months, but the Bank says this lower figure is "an indication of how much new mortgage lending we might expect to see in coming months".
The number of approvals for remortgaging fell 5.5% in July to 45,000.
Vikki Jefferies, proposition director at PRIMIS and PTFS, commented: “It’s no surprise to see that mortgage lending has experienced a dip this month, as the effect of the Bank of England’s August rate rise won't kick in until September - especially when it comes to remortgages.
“However, even though some borrowers may be tempted to take action before rates rise again, the threat of a ‘no-deal’ Brexit has many customers nervous. It’s therefore essential that the lines of communication between brokers and their customers are kept open. By helping customers to understand the different options on offer, and highlighting which products are right for their particular circumstances, brokers have the opportunity to calm borrowers’ nerves and keep the market moving, no matter what headwinds are blowing their way.”
Jeremy Leaf, north London estate agent and former RICS residential chairman, added: "These figures are a little disappointing in that they reflect a period when we would have expected a pick-up in the market over the spring buying season. Buyers and sellers are still engaged in a stand-off, whereas lack of energised demand has meant there is often very little urgency to complete deals, even when terms have been agreed.
"There are regional variations, however. In London, owners who have accumulated property wealth from previous booms seem more reluctant to recognise softening prices whereas outside the capital, where loans to value are generally higher, we have noticed more enthusiasm to move. Overall, viewings are starting to rise as buyers return from holiday so we do expect to see some increase in activity over the next few months."
