Mortgage lending fell in December as a shortage of new homes, higher prices and recent government measures such as stamp duty reforms weighed on the property market.
Figures from e.surv chartered surveyors today showed there were 68,218 house purchase approvals in December, down 3.1 per cent from 70,410 in November.
E.surv director Richard Sexton, said. “Supply issues have become more of a factor in some areas as we head towards the turn of the year, as both growing demand and house prices finally get the attention they deserve from the government, but limited choice of affordable homes is certainly proving a challenge to some buyers."
But despite a dip in December, mortgage lending recovered strongly in the second half with 69,572 average monthly approvals compared to 64,047 across the first six months. On an annual basis approvals climbed by 12.5 per cent.
Meanwhile e.surv said small-deposit lending to buyers with a deposit worth 15 per cent or less of a property’s value – a large proportion of which are first-time buyers – remained flat at 16.3 per cent of total lending in December, with 11,120 loans approved.
“Figures suggest that small-deposit lending has slowed towards the end of the year compared to H1, but year-on-year numbers are up as first-time buyers have increasingly been seen as valuable customers by the lending industry. These first-timers still need help though, and initiatives tackling supply are a crucial first step," Sexton said.