New mortgage hurdles begin to make impact on property market
THE NUMBER of mortgage approvals fell for the third month in a row as housing market activity continued to slow.
Data released yesterday by the British Bankers Association, a trade body for UK banks, revealed that the number of mortgage approvals in September was 39,271 – a 14-month low.
The figure marks a 10 per cent drop on the number of approvals in September 2013.
“The falling back of mortgage approvals from January’s peak level was clearly influenced appreciably by the introduction of the new Mortgage Market Review (MMR) regulations that came into effect in late April,” said Howard Archer of analytics firm IHS.
“Mortgage approvals in September were down by 19 per cent from January’s 76-month high of 48,462.”
The MMR regulations require mortgage lenders to gather much more information about prospective borrowers to ensure they can meet future mortgage obligations. Economists have speculated that it could severely hit housing demand.
Meanwhile, surveys conducted by mortgage lenders Halifax and Nationwide show that house prices have begun to slow over the last few months.