October saw stark fall in mortgage borrowing
Mortgage borrowing totalled £1.6 billion in October, the lowest amount since July 2021, according to the Bank of England.
The number of mortgage approvals for house purchase also fell, to 67,200 in October from 71,900 in September.
The fall was largely expected, following the end of the Stamp Duty holiday at the end of September.
Iain Swatton, head of intermediaries at the mortgage switching platform, Dashly said: “Activity in the housing market inevitably cooled after the mad stampede triggered by the Stamp Duty holiday and this is reflected in the reduced number of mortgage approvals for house purchase in October, the lowest since June last year.
“However, the remortgage market has continued apace with borrowers looking to take advantage of the stupendously low mortgage rates currently on offer. With the threat of an interest rate rise looming due to spiralling inflation, borrowers are locking themselves into low rates in an effort to protect themselves financially.”
Jamie Thompson of Manchester-based Jamie Thompson Mortgages, added: “What’s encouraging is that first-time buyers have much larger deposits than they did 18 months ago as they’ve been able to save at the same time as their ability to spend on holidays and other leisure activities was severely reduced. This is allowing them to get better mortgage products than they typically would as they are able to put down more as a deposit. And even if rates do rise, prospective borrowers know that any increase will be negligible, at least in the short- to medium term.”