Mortgage approvals static in May
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Figures released today from the Bank of England show there were 49,815 loan approvals for house purchase in May, marginally lower than 49,828 in April and below the previous six-month average of 51,856.
The twelve-month growth rate rose to 1.1% but the three-month annualised growth rate fell to 0.8%, from 1.0% in April.
Net mortgage lending increased by £1.2bn in May, stronger than the April rise of £1.0bn but just below the previous six-month average of £1.3bn.
There were 25,759 approvals for remortgaging, lower than in April and below the previous six-month average of 26,443, while approvals for other purposes, 24,656 were also lower than in April and below the previous six-month average of 25,565.
Vicky Redwood, senior UK economist at Capital Economics, says the figures provide further evidence that the housing market recovery is flagging.
She says: “The number of mortgage approvals for new house purchase was broadly unchanged in May at 50,000, with approvals only 2,000 higher than at the start of the year.
“Admittedly, weak activity has not stopped house prices from rising over the past year. But there are also now tentative signs that the increase in prices is running out of steam. We still think that the market will weaken in the second half of the this year.”
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