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BoE: UK has hit 10-month low

Friday, March 19, 2010

Source: Catherine Deshayes

The number of mortgages approved on UK homes dropped again during February to the lowest levels since May 2009, new Bank of England figures show.

Gross mortgage lending was down 5.5% on last year at £9.2bn in February, although it was up from £8.6bn in January, according to a separate survey from the Council of Mortgage Lenders (CML).

Despite the low level of lending during January and February, the CML said the figures were broadly in line with its forecast that lenders would advance a total of £150bn during 2010.

Paul Samter, CML economist, said: "With activity unlikely to pick up much in the short term, we would expect to see continuing price fluctuation in the coming months."

Activity fell in the housing market in February as it was hit by the end of the stamp duty holiday and bad weather.

Nationwide and Halifax reported house price decreases of 1% and 1.5% respectively.

Sky business correspondent, Dharshini David, said: "These figures show the housing market is still very fragile and looks set to remain so in 2010.

"It looks like interest rates won't rise for some months to come. The number of mortgage approvals that go through now will be reflected in house prices in the coming months."

Source: www.Ananova.com