THE number of mortgages approved last month was less than half the level of a year ago, the British Bankers' Association revealed yesterday.
It said 21,854 loans were approved for house purchase in October, the second lowest since the BBA's records began in 1997. The number was marginally up on August, the worst month on record, but 52 per cent lower than October 2007.
The number of
loans approved for remortgaging fell by 6.4 per cent over the year, to 52,425. Net mortgage lending rose by just £2.9 billion, compared with £3.5bn in September and an average for the previous six months of £3.9bn.
The BBA's statistics director, David Dooks, said the government's support for banks, along with lower interest rates, would help consumer demand.
But recovery prospects remain dim, according to Howard Archer, chief UK and European economist at IHS Global Insight.
He said: "Even if the government measures to tackle the financial crisis work on a sustained basis, it will clearly take time for confidence to improve and mortgage lending to pick up significantly.
"On top of this, affordability ratios in terms of house prices to earnings are still relatively stretched despite coming down significantly in recent months."
The full article contains 218 words and appears in The Scotsman newspaper.
