In the latest mortgage approval data released last week by the Bank of England, the statistics reveal a concerning drop in mortgage approval rates.
In June 2022 there were 63,726 mortgages approved, which was 3.0% down on May 2022’s figures, but 21% down on June 2021. The approval rates are the lowest since June 2020, which was mid pandemic.
Industry professionals commented on the news:
Director of Henry Dannell, Geoff Garrett, said:
“A previous flurry of spring mortgage market activity had reversed the steady decline in mortgage approvals seen so far this year, however, it seems as though this has been short lived and the latest figures once again show a reduction in buyer appetites with approvals reaching their lowest point since June 2020.
“This more muted performance was largely expected following multiple increases to the Bank of England base rate, combined with an escalating cost of living and rising inflation.
“It’s likely we will now see mortgage approvals see-saw marginally up and down from month to month as a result of seasonal influences, but we expect to finish the year at a much lower threshold when compared to the unusually high records set during the pandemic.”
CEO of Octane Capital, Jonathan Samuels, commented:
“The current economic climate has created a far less settled landscape so far this year, particularly within the mortgage market. This is starting to show with a reduction in mortgage approvals but we are yet to see any concrete signs that the pandemic property market boom is starting to subside.
“With the market maintaining a good level of momentum, we expect that mortgage approvals will tread water between sixty to sixty five thousand approvals a month for the remainder of the year. Some way off the dizzying heights of the pandemic, but a return to pre-pandemic normality.”
Founding Director of Revolution Brokers, Almas Uddin, commented:
“The latest mortgage approvals figures will bring no cause for celebration, but they’re certainly no cause for panic either.
“The preventative pandemic measures implemented by the Government to keep the property market up and running have now worn off and we’re unlikely to see a booster jab in the form of any new initiatives in 2022.
“Despite this, the current level of mortgage market activity remains there or thereabouts when compared to a less frantic, but consistently steady pre-pandemic property market.”