‘UK banks approved 11 per cent fewer mortgages in February’

Mortgage approvals fell to 38,120 last month

UK banks approved 11 per cent fewer mortgages in February compared with the same month last year, according to figures from UK Finance, suggesting a downturn in Britain’s housing market.

The mortgage approvals fell to 38,120 last month — down from 40,031 in January. Meanwhile, the financial services trade association added that remortgage approvals rose 9 per cent in February.

“There has been an increase in remortgage approvals compared to last year, as borrowers look to lock in to attractive deals amid speculation of further interest rate rises later this year,” said Eric Leenders, managing director, personal finance at UK Finance.

“We are also seeing a continuing rise in credit card spending, reflecting the growing number of transactions carried out using cards, while other forms of borrowing such as overdrafts continue to fall. Meanwhile real wages continue to be squeezed by inflation, impacting on consumer confidence and retail sales. This pressure on household incomes should ease in the coming months, as the effect of the fall in sterling begins to fade and the strong labour market leads to a better outlook for wage growth.”