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Mortgage approvals hit fresh low

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Date: Tuesday 29 Apr 2008

LONDON (ShareCast) - Consumers tightened their belts another notch last month as tough credit conditions caused a sharp fall in mortgage approvals, according to data from the Bank of England.

Mortgage approvals tumbled to their lowest since records began, figures from the BoE showed, down to just 64,000 in March from a downwardly revised 72,000 the previous month.

Net consumer lending rose by £8.2bn in March, less than the downwardly revised £9.6bn for the month before and worse than the £8.5bn predicted by analysts.

The central bank said net consumer credit almost halved to £1.2bn in March from February’s £2.3bn, in line with expectations, while mortgage lending fell £400m to £6.9bn.

Lending for house purchases was £9.3bn, well below February’s £10.4bn.

Elsewhere today, the Building Societies Association (BSA) reported a drop in gross lending to £3.63bn in March from £3.86bn a month earlier and £5.44bn a year ago.

Net lending at £580m was nearly half February’s level and the worst since July 2007.

The BSA Mortgage approvals fell to £3.02bn from £3.41bn the month before and from £5.24bn on eth year ago figure.