Growth in net lending secured on property has fallen in August compared with July and is also down on the previous six-month average, according to the Bank of England.
The latest lending figures from the Bank also show a fall in net consumer credit compared with July.
Total lending secured on dwellings was £8.5bn in August, compared with £8.9bn in July and an average of £9.3bn over the previous six months, possibly indicating a slowing housing market following successive interest rate rises.
The number of loans approved for house purchase in August was 109,000, compared with 115,000 in the previous month, while remortgage approvals fell from 100,000 to 96,000.
The figures indicate the Bank of England’s recent interest rate hikes are having a dampening effect on the property market.
Figures also show a fall in enthusiasm among homeowners to cash in on the increased equity in their homes. House equity withdrawal figures fell from £13.1bn in the first quarter of 2007 to £10bn in the second quarter.
The findings will likely renew calls for the bank to cut interest rates as they already seem to be having an effect on borrowing figures. Some analysts also fear mass repossessions when many old fixed rate mortgages expire over the next few months.
If you would like to comment on this story, contact:
Tel: 020 7034 2682
e-mail: [email protected]
'Managed separation update'
The chairman discusses his surprise holiday job
Three months on
Regulator has stepped in