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Fewer home loans as high interest rates bite
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The housing market is showing signs of cooling, with fewer people taking out mortgages, figures showed yesterday
The British Bankers' Association said 169,784 people took out a home loan or remortgaged during April, a drop from almost 200,000 on the previous month and a rise of just one per cent on the previous year.
Around 65,000 people took out a loan to buy a new home in April, representing a fall of around 10,000 from the previous month.
The association said the figures showed demand moderating in the face of rising interest rates. David Dooks, director of statistics at the BBA, said: "The latest three months have seen net mortgage lending stabilize, with rates - albeit still around £5 billion a month - below the average of the previous six months."
He said the picture painted by mortgage approvals data "points to mortgage demand weakening as higher interest rates bite harder".
Gross mortgage lending for the month was £17.3 billion - a rise of 12 per cent on April 2006. This largely reflects a 10 per cent annual growth in house prices and strong remortgaging activity. Howard Archer, chief economist with Global Insight, said the data added to evidence that the housing market is slowing because people cannot afford to buy new homes.
Source:: telegraph.co.uk
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