UK Mortgage Approvals Fall

The number of new mortgages approved in the UK fell from 54,000 in September to 44,100 in October. This is a fall of 37 per cent slump on October last year. This reflects the weakness in the housing market and could be a prelude to falling house prices.

The decline in the number of mortgage approvals is blamed on:

• Government’s controversial home buyers package, which makes it more bureaucratic to put your house on the market
• A stagnating market – less houses are being put on the market
• Declining confidence following the problems of Northern Rock.
•  Global credit crunch leading to less mortgages being made available e.g. Kensington Mortgages withdrawing sub prime mortgages
• Recent interest rate rises having an increasing effect on reducing consumer spending

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