BBA Reports Mixed on UK Housing Market
Mortgage lending in the UK slowed last month, as overall mortgage lending decreased more than 10%, to 7.6 billion pounds. The British Bankers’ Association also reported home loan approvals were up to 31,747 in May. This is a higher level than it has been in more than ten months, but 6% lower than the same time last year.
The statistics director at the BBA, David Dooks, commented on where the current growth is coming from within the housing market, saying: "Banks continue to lend for house purchase, but the weak mortgage market is self-evident, although some growth is coming from the buy-to-let sector to meet demand for rental properties."
Results from the BBA could not be more ill-timed. Reports during the past few weeks have been anything but optimistic. Home sales in Scotland fell hard during the month of June, to say nothing of the fact that inflation is maintaining its position within the UK economy and making purchasing power anything but powerful.
Surveyors have come out and said that since more homes on the market are outpacing the number of people looking to buy, prices were likely to keep falling over the next few months.
Howard Archer, chief UK and European economist at IHS Global Insight, recently commented on the level of mortgage approvals within the housing market, saying: "Although they were at an 11-month high in June, mortgage approvals were still very low by long-term norms and there is currently little evidence that housing market activity is shifting up a gear."