U.K. Mortgage Approvals Unexpectedly Decline in SeptemberJill Ward
U.K. mortgage approvals unexpectedly declined in September after rising to the highest since early 2014 the previous month.
Approvals slipped to 68,874 from 70,664, the Bank of England said in London on Thursday. While economists had forecast an increase, the decline still left the September total above the average over the previous six months. Net mortgage lending, which lags approvals, rose 3.6 billion pounds last month, the most since 2008.
Recent data has pointed to continued buoyancy in Britain’s housing market, with low interest rates fueling demand that’s unmatched by new supply. The central bank said the effective interest rate on outstanding mortgages is at 3.04 percent, down from 3.2 percent a year ago.
Nationwide Building Society said earlier that house-price growth picked up in October, with the annual increase accelerating to 3.9 percent from 3.8 percent. It said values have been rising at a pace broadly consistent with earnings growth in recent months.
“While this bodes well for a sustainable increase in housing market activity, much will depend on whether building activity can keep pace with increasing demand,” said Nationwide Chief Economist Robert Gardner.
The BOE report also showed that lending to businesses fell 938 million pounds in September. Loans to small and medium-sized companies increased almost 250 million pounds and were up 0.3 percent from a year earlier.