Royals, rain and Euros dent mortgage approvals
Wednesday, 25 July 2012 11:26 AM
A combination of the Jubilee, Euro 2012 and terrible weather led to a big fall in mortgage approvals in June, according to the British Bankers Association (BBA).
Approvals for house purchase were down 20.5 per cent on a year ago while remortgaging approvals were down 42.9 per cent.
Banks approved a total of 26,269 loans for house purchase in June. That compares with 29,567, in May, a fall of 12.5 per cent, and 33,056 in June 2011.
This was the lowest total for June since 2008 and less than half the level seen in any June between 1997 and 2007.
However, a fall in the number of approvals for house purchase over the last 12 months suggests that the problems in the market may be about more than just the royals, the football and rain.
A total of 368,225 loans for house purchase were approved in the year to June, a fall of 7.5 per cent on the previous year.
The approvals were worth £4.2bn in June, which was again the lowest June total since 2008, and around the same as in June 1999 when house prices were much lower.
BBA statistics director, David Dooks said: "Public holidays and wet weather put a damper on mortgage approvals in June and demand for unsecured household borrowing was also low. Paying off loans or overdrafts and building up deposits is the current consumer ambition.
“Business output remains weak, so demand for finance is subdued, with companies tending to delay investment and concentrate on reducing their bank debt."
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