The number of new mortgage approvals dropped once more during February, according to fresh data from the British Bankers’ Association (BBA).
There were 42,613 approved by British banks in the month, which represents a fall of 3.46 percent when compared to the 44,142 approved in January.
“The February slowdown in mortgage approvals for house purchases fuels our belief that the housing market will come under increasing pressure over the coming months,” said Howard Archer of IHS Global Insight.
Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said: “Housing demand has begun to relapse now that real wages are falling and mortgage rates have hit a floor. Admittedly, approvals were still 3.7 per cent above their 41,100 average of the prior 12 months.
“But the new buyer enquiries balance of the Rics residential market survey fell to zero in February – its lowest level since August – from plus 3 in January.”
Since the referendum of June 2016, house prices have consistently risen. According to figures provided by the Office for National Statistics (ONS), average house prices rose at an annual rate of 6.2 per cent in January.
This was up from a rate of 5.7 per cent in the year to December, although down from a peak of 9.4 per cent in the month of the referendum.
Currently, the average price of a house in Manchester is around £151,800, which represents nearly a 9 per cent rise, whereas in London a house is likely to cost £488,700, a rise of 5.6 per cent.