House purchase approvals fall 16%: BBA

House purchase approvals have fallen by 16 per cent in the last 12 months, data from the British Bankers’ Association has revealed, suggesting that the property market is continuing to cool.

The research said that approval processes experienced a temporary bottleneck with the implementation of the Mortgage Market Review earlier this year, and that after recovering in June, recent figures indicated that overall approval numbers had slowed.

The BBA’s September data also revealed that house purchase approvals fell 10 per cent.

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However, gross mortgage borrowing in October was £10.5bn, 2 per cent higher than in the same month last year. Despite a slowdown in demand, the overall mortgage stock continues to rise and is 1.6 per cent higher than a year ago.

Remortgages also fell 21 per cent in October compared to a year ago, the BBA said, which tallies with data published from the Legal Marketing Services that showed monthly gross remortgage lending decreased 20 per cent in October to £3.5bn.

According to the BBA, equity withdrawal was also 34 per cent lower than this time last year.

Following on from the changes to Isa rules on 1 July this year, the last four months have seen net inflows of £7.9bn, the BBA said.

A total of £11.2bn went into Isas in the 12 months to October, up nearly 22 per cent on the same period a year earlier, and that overall personal deposits are growing by 3.5 per cent annually.

Richard Woolhouse, chief economist at the BBA, said: “Despite softening in the housing market, consumers continue to show confidence in the economy with unsecured borrowing at its highest growth rate in years.

“At the same time we all continue to make the most of new Isa rules, stashing more in our savings accounts over the course of the last year.”