Fewer mortgages approved in August

It appears that fewer people were prepared to get their first mortgage in August and figures reveal that the number of loans for home purchase fell.

The British Bankers' Association (BBA) has published statistics for the month which show that 168,291 mortgages were approved.

That signifies a drop of 8.8 per cent compared to August 2006, with each loan being valued at around £153,800, nine per cent more than one year ago.

When combined, the loans totalled £19.1 billion, just 0.2 per cent higher than the previous year.

"With house price inflation still in double digits, we might have expected stronger gross lending in August," said David Dooks, director of statistics at the BBA.

"However we are seeing a similar level to last year, which suggests that volumes are lower.

"Other than the current spate of remortgaging, loan approval numbers also endorse our view that customer demand was starting to moderate even before the September difficulties in the financial markets," he added.

Overall, underlying net mortgage lending increased by £6.1 billion between July and August.

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