Mortgages 

Mortgage lending drops 2%

Mortgage lending drops 2%

Residential mortgage lending was down 2 per cent year on year in November, according to latest figures.

Data released by UK Finance this morning (December 28) showed gross mortgage lending was £23.1bn in November, down from £23.56bn in the same month last year.

The number of mortgages approved by the main high street banks in November was also down 10.6 per cent, with approvals for house purchases down 1.2 per cent, remortgage approvals down 20.3 per cent, and approvals for other secured borrowing down 12.2 per cent. 

Personal deposits however grew by 0.7 per cent over the past twelve months to £848bn. Deposits held in instant access accounts were 3.1 per cent higher than last November, according to UK Finance.

The trade body also revealed credit card spending was up 7.5 per cent year on year as people spent a total of £11.3bn in the month.

Over the past twelve months, the outstanding level of credit card borrowing grew by 5.3 per cent. Personal borrowing through loans and overdrafts grew by 2.5 per cent in the year to November.

Eric Leenders, managing director of personal finance at UK Finance, said: "Overall mortgage borrowing across the residential property market remains stable and the trend in households' cash savings remains steady.

"The increase in spending, which is largely offset by cardholder repayments, reflects the growing use of credit cards as a preferred form of payment, particularly in travel, as consumers take advantage of stronger customer protection and value-added benefits." 

Ross Boyd, founder of the mortgage switching platform, Dashly.com, said: "The sharp drop in the number of remortgages compared to a year ago is a sign of action not apathy.

"Brexit and the sheer uncertainty of what could happen to the economy in 2019 have seen a significant percentage of households proactively remortgage over the past year.

"The slight drop in the number of mortgage approvals reflects the continued stasis in the property market." 

He added: "What’s encouraging is that personal deposits are up compared to November 2017. That may partly explain the plight of the high street.

"As we approach 2019 and Brexit, households are digging in rather than splashing out."

carmen.reichman@ft.com

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