UK Mortgage Approvals: 35.612k (Forecast 45k, Previous 46.075k)

UK Mortgage Approvals: 35.612k (Forecast 45k, Previous 46.075k)

As Andy Bruce notes:

Shockingly small number of mortgages approved in December, according to Bank of England data just out - just 35,612.

Lowest number since the financial crisis, if you exclude the pandemic. Reuters poll of economists had pointed to 45,000

Full Report

Key points:

Net borrowing of mortgage debt by individuals decreased from £4.3 billion to £3.2 billion in December.

Mortgage approvals for house purchases decreased to 35,600 in December from 46,200 in November, the lowest since May 2020. This marked the fourth consecutive monthly decrease in mortgage approvals.

The ‘effective’ interest rate – the actual interest rate paid – on newly drawn mortgages increased by 32 basis points, to 3.67% in December.

Consumers borrowed an additional £0.5 billion in consumer credit, on net, compared with £1.5 billion borrowed in November. Credit card repayments of £0.5bn were more than offset by £1.0 billion of borrowing through other forms of consumer credit.

Households deposited an additional £3.9 billion with banks and building societies in December. Within this, net flows of interest bearing and non-interest bearing sight deposits remained negative at -£1.3 billion (from -£1.5 billion) and -£0.2 billion (from -£4.7 billion), respectively. These net withdrawals were more than offset by the flow into time deposits of £6.9 billion (down from £10.4 billion in November).

Non-financial businesses (PNFCs and public corporations) borrowed £1.9 billion of bank loans in December, while non-financial companies (PNFCs) repaid £5.0 billion in market finance.

The net flow of sterling money (known as M4ex) decreased to -£34.7 billion in December, from -£24.0 billion in November. This was primarily driven by non-intermediate other financial corporations (NIOFCs), with net flows decreasing to -£34.2 billion (from -£24.4 billion in November). Conversely, net lending to the private sector (known as M4Lex) rose to £2.2 billion from -£15.7 billion over the same period.

GBP GBP The Great British pound (GBP) or pound sterling is the official currency of the United Kingdom, Jersey, Guernsey, the Isle of Man, Gibraltar, South Georgia, and other pacific territories.The GBP is currently the fourth most-traded currency worldwide in forex markets after the US dollar, euro, and Japanese yen.As the oldest currency in continual use, the GBP holds great weight on the world market and is also the fourth largest reserve currency.The Bank of England (BoE) is the central banking auth The Great British pound (GBP) or pound sterling is the official currency of the United Kingdom, Jersey, Guernsey, the Isle of Man, Gibraltar, South Georgia, and other pacific territories.The GBP is currently the fourth most-traded currency worldwide in forex markets after the US dollar, euro, and Japanese yen.As the oldest currency in continual use, the GBP holds great weight on the world market and is also the fourth largest reserve currency.The Bank of England (BoE) is the central banking auth Read this Term