Mortgage approvals fall to July 2013 low

Peter Spence
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Mortgage applications were forecast to see a third monthly decline (Source: Getty)

Mortgages have seen another fall, dropping to 62,918 in April, from 66,563 in March, according to new figures from the Bank of England.

That compares with an average of 70,132 over the previous six months. We had a good idea that we'd see that third monthly decline today.

Timelier measures from the BBA saw mortgage approvals made by the major high street banks fall from 45,045 to 42,173 in April, nearly a drop of 3,000.

Tightening mortgage standards take part of the blame, but it's hard to say for sure what's driving these declines. Are we seeing a temporary decline on the back of those stricter rules and an increase in fixed rate mortgages, or is activity in the housing market cooling more permanently?

Samuel Tombs, UK economist at Capital Economics, points to surveys such as the RICS housing market survey, which have for several months suggested that demand is fading.

Investec's Philip Shaw says that while it's difficult to say whether the trend is temporary or more fundamental, Investec suspects that it is the former.