Figures indicate that the housing market may be losing some momentum, as Britain’s banks approved the lowest number of mortgages last month since August last year.
Over the last year it has been reported that house prices have increased by ten per cent and some credit a lot of this to the Help to Buy scheme brought in by George Osborne.
The British Bankers Association said that 42,173 mortgages were approved in April this year, which was the third step down per month in a row. March saw 45,045 mortgages approved.
These figures are arguably to have been expected however, with the recent restrictions on mortgages that have come into play. These guidelines were supposed to stop borrowers taking on debt that they couldn’t handle, but that of course means that fewer mortgages will be approved.
Conversely, it appears that the average value of mortgages is still going up, reflecting the ever increasing prices of homes. There are fears this will lead to a housing bubble which could crash the market. The net mortgage lending was reported to hit a high of £1.08 billion in April, the highest since August.
After a June meeting of the Financial Policy Committee, the Bank of England could bring forward more controls on the mortgage sector, it is believed.
