With the news of poor net lending and slowdown in the number of mortgage approvals in the month of September, the apprehensions related to the double-dip in the mortgage market grew on Friday.
As per the statistics brought out by the Bank of England, the number of new home loans sanctioned in September stood at 47,474, almost similar to the figure of 47,498 witnessed in August. The net lending came down to £112m in the same month from £1.62bn in August.
The figures came after the Thursday’s announcement from Nationwide Building Society that in October, the house prices dropped by 0.7% and the quarter-on-quarter decline was 1.5%, which is considerably huge since April
2009. The house prices were reported declined by 0.2% in September and 0.9% in October by the Land Registry.
The downfall in the mortgage lending has been contributed by projected high unemployment, lessened advancement in wages and shaking consumer confidence, as expressed by analysts.
In September, the unsecured borrowing increased by £262m, as compared to the previous month and it was the strongest rise since May. The total money borrowed by consumers rose marginally by £0.3bn in September, more than the average six-month increase of £0.1bn.
“Low mortgage interest rates and the current stamp duty holiday for first-time buyers on all properties costing up to £250,000 only partially offsets the adverse factors”, said Howard Archer of IHS Global Insight.