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Mortgage Approvals Decline In September to Lowest Level Since March 2009

U.K. mortgage approvals fell in September to the lowest level since March 2009 because of weaker demand for homes, the British Bankers’ Association said.

Lenders granted 31,104 home loans, compared with 31,781 in August, the group, which represents U.K. banks, said today in an e-mailed statement in London.

“Demand for new mortgages remains low despite more properties on the market and falling house prices,” David Dooks, director of statistics at the BBA, said in the statement. It’s a “reflection of household uncertainties” ahead of the government’s spending review which was announced last week.

A survey by Rightmove Plc showed today that the number of Britons who expect house prices to fall outnumbered those forecasting an increase for the first time since 2009. The drop in confidence in the property market comes as Chancellor of the Exchequer George Osborne prepares to implement cuts to shrink the budget deficit that may lead to the loss of half a million public-sector jobs.

The BBA report also said that consumer spending remains “subdued” and demand for unsecured credit contracted by 1.6 percent in the year through September. Personal deposits rose 4.6 percent in that period, it said.

To contact the reporter on this story: Svenja O’Donnell in London at sodonnell@bloomberg.net

To contact the editor responsible for this story: John Fraher at jfraher@bloomberg.net

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