The number of mortgages approved in the
The Bank of
Mortgage approval numbers are closely followed by economists as a timely indicator on housing market activity, which some surveys suggest has come off the boil in recent months.
The dip in May approvals follows the introduction of new lending rules in April under the Mortgage Market Review (MMR), which force banks and building societies to undertake tough affordability checks before they grant loans.
The Bank of
"Given that the
"This was the fourth successive fall in approvals, and leaves them at their lowest level since June last year, and 19% below this January's peak."
"After the temporary disruption from tighter regulations has passed, we expect approvals to return to their upward trend and we look for house prices to gain 10% in 2014 and 2015," he said.
The BoE's data on the amount of mortgage lending showed it rose more than expected by £1.99bn in May, the biggest increase since
There were some reassuring signs for business groups who have complained that a lack of access to bank loans has been stopping companies from making the most of the economic recovery. Lending to businesses rose by £3.41bn in May, the biggest increase since records began in
But the numbers should only get a cautious welcome, said
"While a welcome development, it remains to be seen if May's marked increase in lending to businesses is the start of an improving trend. There have been false dawns before," he said.
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