Mortgage approvals dropped to 60,000 in January, below an average of around 64,100 over the previous 6-months, the Bank of England Money & Credit data for January has found.
Approvals for remortgaging decreased slightly to 38,100 in January from 38,400 in December.
Tomer Aboody, director of specialist lender MT Finance, says: “As net mortgage approvals reduce again in January, the market is still feeling the hit from the Chancellor’s Budget along with the lack of constant support for the market.
“Some encouragement from the government would be timely, perhaps in the form of reducing or reforming stamp duty, encouraging more people to transact. While interest rate reductions are helpful in encouraging activity, on their own they do not seem to be enough to boost transaction numbers.”
Simon Gammon, managing partner, Knight Frank Finance, said: “Mortgage approvals fell in January, reflecting the economic uncertainty that lingered after the November Budget and weighed on borrower confidence. However, leading indicators published over the past month, including asking prices, suggest activity recovered into February as borrowing costs eased.
“The outlook for activity and rates appeared relatively benign only last week, but conflict in the Middle East has introduced fresh uncertainty. Any spike in oil prices could fuel global inflation or, at the very least, prompt central banks, including the Bank of England, to delay further rate cuts until the outlook becomes clearer.”
