Advisers looking to help first-time buyers onto the housing ladder may find lenders becoming less open, as approvals show.
Data from LSL Property Services revealed there were 65,356 house purchase approvals in July, down 1.8 per cent on June.
Annual growth had also dropped, with house purchase approvals falling 0.2 per cent year-on-year, after three months of strong yearly increases. The 0.2 per cent drop was from 65,517 in July 2014 and marked the first year-on-year fall since March 2015.
Richard Sexton, director of e.surv, part of the LSL Property Services Group, said the number of mortgage approvals for house purchase had fallen against a backdrop of the Bank of England’s threats to raise the base rate.
This came as figures from the Council of Mortgage Lenders showed that by the end of June this year, the total number of mortgages in arrears of 2.5 per cent or more of the balance had dropped to 106,400 – the lowest number since quarterly records began in 2008.
According to an economist note from the CML: “Low interest rates are continuing to provide support for home owners and may be helping to stave off low-level arrears for financially stretched households.”
HOUSE PURCHASE (seasonally adjusted)
Month | Number | Monthly change | Annual change |
February | 61,966 | +1.9% | -11.6% |
March | 61,650 | -0.5% | -8.3% |
April | 68,051 | +10.4% | +7.8% |
May | 64,826 | -4.7% | +4.0% |
June | 66,582 | +2.7% | +1.5% |
July | 65,356 | -1.8% | -0.2% |
Source: e.surv
Adviser view
Jonathan Harris, director of London-based mortgage broker Anderson Harris, said: “What will happen when interest rates do start to rise? We suspect there are many people teetering on a financial knife edge and rate rises could easily push them over.”
