Net mortgage lending grew by only £1.8bn in April compared with £2.3bn in March, and was below the previous six month average, figures from the British Bankers Association show today.
The annual growth in the banks’ net mortgage lending of 4.3%, slightly lower than last month’s 4.5% still substantially exceeds annual growth of just 1% in March for the mortgage market overall.
Gross mortgage lending of £8.2bn in April was lower than both March and the average of the previous six months – £9.1bn.
Repayments were stronger than usual as banks actively encouraged borrowers to use surplus cash to reduce their borrowing where possible.
The report shows the numbers of approvals for house purchase, though higher than the same point a year ago, are low when compared to historical trends.
The average value of house purchase approvals (£146,700) was 11.7% higher than a year ago. Numbers of remortgaging and equity withdrawal approvals continue to be lower than a year earlier
David Dooks, statistics director at the BBA, says: “Household priorities are clearly reflected in these latest data, with people paying down debt rather than building up savings, even in the main ISA season. Uncertainties about the impact of government policies and the economy on households and businesses will continue to dent consumer confidence and influence decision-making.
“Overall lending to companies remains subdued, although the annual rate of contraction appears to have bottomed out.”