Mortgage lending hits lowest level since 2016 excluding pandemic

Mortgage lending successful February fell to its lowest level since 2016, excluding the pandemic, according to Bank of England figures.

It comes arsenic higher borrowing costs marque buying spot little affordable.

Homeowners borrowed £700m successful February, down from £2bn successful January, and the lowest level for immoderate period since April 2016 isolated from the Covid crisis.

However, the Bank said the fig of mortgages approved by lenders roseate somewhat from 39,600 to 43,500.

Karen Noye, a owe adept astatine Quilter, said the effectual involvement complaint connected caller mortgages roseate to 4.24% successful February, making borrowing much costly for imaginable home-owners.

But she said the rebound successful approvals suggested "green shoots mightiness beryllium appearing" successful the lodging market.

"It's wide that home-buyers are cautiously returning backmost to the marketplace successful aboriginal 2023 aft the immense shocks astatine the backmost extremity of past twelvemonth made galore enactment their location hunts connected ice. How this each feeds done to location prices is yet to beryllium seen."

Mortgage rates began to emergence past twelvemonth arsenic involvement rates climbed, but they spiked successful September aft Liz Truss's mini-budget caused panic connected fiscal markets.

Rates person stabilised since past but stay overmuch higher than they were a fewer years ago, squeezing people's purchasing power.

It has fed done to location prices, which successful the twelvemonth to February saw their biggest yearly autumn successful much than 10 years, according to Nationwide.