Home purchase mortgage approvals plunge almost 10% on a year ago

Mortgage approvals for home purchase hit a six-month low in September, data from the main high street banks shows.

Figures from trade body UK Finance showed there were 37,352 mortgage approvals for house purchase last month, down 9.4% annually and the lowest figure since March 2018.

It is also the third consecutive month that approvals have dropped.

Lenders also approved fewer remortgages, down 7.4% annually to 27,676.

Commenting on the figures, Paul Hunt, managing director of financial technology firm Phoebus Software, said: “We are beginning to see something of a trend with the market waning in the past few months.

“However, recent reports show first-time buyer activity at a 14-month high and there are also growing signs that there is still a good amount of appetite with some estate agents reporting an increase in the number of properties coming to market.

“Nevertheless, to say we are heading into choppy waters is probably an understatement as the politics surrounding Brexit negotiations continue to cast doubt in people’s minds.

“However, with mortgage lenders having quotas to fill and targets to hit, we could see a raft of deals coming to market to tempt. As consumers turn to credit cards to fund their spending, the question will be whether, as we head towards Christmas, people choose property or the path of least resistance.”

Meanwhile, data from Mortgages for Business, based on its third quarter activity, has suggested buy-to-let mortgages for houses in multiple occupation (HMOs) have become the most popular form of borrowing by landlords.

The broker found that 32% of completed purchase transactions were for HMO buy-to-let loans, up from 32% in the second quarter.

Meanwhile, the proportion of standard buy-to-let purchase loans fell from 35% to 33% over the same period.

The broker also found that the proportion of buy-to-let transactions completed by limited companies increased from 42% to 44% between the second and third quarter.

However, their share of the value of lending fell from 44% to 43%.

Looking ahead, there was a drop in the proportion of applications submitted by landlords using a corporate structure from 48% in the second quarter to 44% in the third.

Iamproperty end of news story
x

Email the story to a friend



2 Comments

  1. Mark Connelly

    BREXIT uncertainty?

    The paradox here is that 1st buyer activity is at a 14 month high. the very demographic that was and is adamantly against Brexit seem unperturbed. Meanwhile the supposed group that supported it are paralyzed with indecision. How strange.

    Report
    1. surrey1

      Either that or the average age of the first time buyer is much older than we ever dared to fear 🙂

      Report
X

You must be logged in to report this comment!

Comments are closed.

Thank you for signing up to our newsletter, we have sent you an email asking you to confirm your subscription. Additionally if you would like to create a free EYE account which allows you to comment on news stories and manage your email subscriptions please enter a password below.