BBA: Mortgage approvals rise slightly but still low

Date:Friday 24th October 2008
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Mortgage lending increased slightly in September but showed a significant year-on-year drop, new figures have shown.

The number of approved mortgages from the biggest British banks reached 23,422 in September, an increase from August's record low of 21,342, the British Bankers' Association (BBA) reported.

But September's figures still demonstrated a fall of 57 per cent compared to a year before and were below the six-month average of 27,481.

The BBA's statistics director, David Dooks, was quoted by the Financial Times as blaming increased pressure on household budgets, the slowing economy and "fragile consumer confidence" for reducing consumers' willingness to take out secured borrowing.

Economist Howard Archer told the Telegraph that the BBA figures "do little to dispel the view that housing market activity continues to be suffocated by very tight lending conditions and still-stretched affordability ratios".

Data from the Council of Mortgage Lenders shows that lending for house purchases was 63 per cent less in August this year than the same month in 2007.