Biggest fall in mortgage lending in 18 months

via: TheTelegraph
by: Rachel Cooper
July 30, 2012

Mortgage approvals and lending slumped in June, Bank of England data showed, reflecting broader economic weakness due to extra public holidays and wet weather.

Mortgage approvals and lending slumped in June, Bank of England data showed, reflecting broader economic weakness due to extra public holidays and wet weather.

The Bank said mortgage approvals fell to 44,192 last month, down from 50,544 in May, the lowest reading since December 2010 and well below analysts’ forecasts of a reading of 49,000. Net mortgage lending also slipped, shrinking by £355m, which was the sharpest drop since December 2010.

That mirrors a general weakness in the economy, with figures last week showing that economic output in the second quarter of 2010 suffered its biggest fall since early 2009, contracting by 0.7pc. One-off effects compounded the misery faced by an economy already mired in recession and hurt by the eurozone debt crisis and public spending cuts.

Recent housing market data suggests weakening demand is hurting prices, with a Hometrack report on Monday showing home values fell for the first time in seven months in July.

Continue Reading At: Telegraph.co.uk

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