Latest Bank of England data has shown that mortgage approvals slipped by 600 to 65,500 in February from a year ago, following a fall of 400 mortgage approvals in January.
Approvals for remortgaging to a new lender were down by 800 to 32,000 in February, following an increase of 2,100 the previous month.
Mortgage borrowing fell by around £900 million to £3.3 billion in February, following an increase in net borrowing of about £800 million in January.
Separately, approvals for remortgaging decreased by 800 to 32,000, following an increase of 2,100 in the previous month.
Richard Pinch, Senior Director Risk at Broadstone said “Continued economic uncertainty, stickier inflation and therefore interest rates, plus the end of the Stamp Duty holiday all appear to be conspiring to deter home buyers with both mortgage borrowing and approvals falling in February. Despite the strength of the property market in terms of pricing, it is clear that there is still considerable fragility in consumer confidence at the minute.
“As global economies hold their breath as they wait to see the detail and impact of President Trump’s tariffs on Wednesday, it seems unlikely that sentiment is likely to strengthen in the near-term although there is still the prospect of at least a couple of interest rate cuts from the Bank of England.”
Mark Eaton, Chief Operating Officer at April Mortgages, said “Mortgage approvals fell for the second consecutive month in February, suggesting that lending activity is slowing as April’s stamp duty deadline approaches.
“The increase in activity that we saw at the end of last year was partly driven by buyers trying to get their deals over the line before the deadline hits – but as we get closer, the urgency has started to ebb away.
“Gross lending has surged to its highest level in more than two years, reflecting the fact that many borrowers are still going ahead – but often with higher loan sizes. With house prices at near-record highs and mortgage rates significantly higher than what many were used to just a few years ago, affordability is stretched.
“To cope with this, we’re seeing more borrowers turn to long-term fixed rate products that provide access to larger loan amounts and greater payment certainty – peace of mind in a market that still feels unpredictable.”
Source: Credit Connect
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