There’s been an increase in the proportion of mortgage offers being cancelled, underlining the turbulent nature of the housing and financial markets in recent months, search from Sirius Property Finance shows.
Cancellations refers to when mortgage offers are withdrawn due to a change of circumstances, such as an applicant’s change of income.
In 2022 mortgage cancellations accounted for 13.3% of all gross mortgage approvals, creeping up by 0.6% versus 2021 and the highest level of mortgage market instability seen since 2013.
Nicholas Christofi, managing director of Sirius Property Finance, said: “As interest rates have continued to climb, it’s not only had an impact on the appetite of the nation’s homebuyers, but it’s led to a growing level of mortgage market instability.
“While both the volume of mortgage approvals and cancellations have dropped, the number of cancellations as a proportion of mortgage approval market activity has actually climbed to its highest level in the last decade.
“This demonstrates the far trickier landscape buyers are having to negotiate when it comes to the higher cost of borrowing and the reluctance that many have had in following through with a mortgage offer as interest rates have risen.”
Some 891,990 mortgages were approved in 2022, an average of 74,333 per month.
This marked a -18.4% drop on the previous year, when gross approvals hit a 10 year high of almost 1.1million.
Fewer mortgage approvals also led to a decline in mortgage cancellations, with 136,970 cancellations being seen throughout 2022, a drop of -13.8% on the previous year.
