UK mortgage approvals dip in February
UK mortgage approvals unexpectedly declined in February, according to figures released by the Bank of England.
The number of new home loans approved fell to 68,315 from 69,114 in January, versus expectations for an uptick to 69,900.
New mortgage lending, net of repayments, came in at £4.9bn in February compared to £4.8bn the month before.
Howard Archer, chief UK and European economist at IHS Markit, said the slowdown in mortgage approvals "suggests that housing market activity may now be starting to be affected by the increasing squeeze on consumers and their concerns over the outlook".
"The dip in mortgage approvals fuels our belief that the housing market will come under increasing pressure over the coming months. Markedly weakening consumer fundamentals, likely mounting caution over making major spending decisions, and elevated house price to earnings ratios are likely to weigh down on housing market activity and house prices. However, a shortage of supply is likely to put a floor under prices."
Meanwhile, consumer credit rose by £1.44bn, down from the month before but above expectations for a £1.3bn increase.
Archer said: "While still above December’s low, February’s unsecured credit data point to a recent modest overall slowdown in the underlying trend. It was the second lowest level since last July and was just below the 2016 monthly average of £1.56bn. Until recently at least, relatively confident consumers have been generally keen to take advantage of low interest rates to borrow."