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Mortgage lending dips to year low Mortgage approvals hit year low
(20 minutes later)
New mortgage lending in the UK fell to 12-month lows in April, Bank of England figures show. The number of new mortgage approvals in the UK fell to a 12-month low in April, Bank of England figures show.
Mortgage approvals totalled 107,000 down from 111,000 in March - the third monthly decline in a row. Mortgage approvals totalled 107,000 in April, down from 111,000 in March and the third monthly decline in a row.
The data also hinted the market may be slowing as the value of home loans rose £8.9bn, compared with £9.9bn in March. In a further indication of weakening buyer demand mortgage lending rose by £8.9bn, much less than expected and the weakest rise since September
But, more surprising, was the sharp drop in consumer debt which rose by £498m - half what was expected and its the weakest increase since March 1997. Consumer debt rose by only £498m - half what was expected and the smallest increase since March 1997.
Rate pressure
Historically low interest rates in the past few years have encouraged Britons to take on a mountain of debt - now reaching £1.5 trillion.Historically low interest rates in the past few years have encouraged Britons to take on a mountain of debt - now reaching £1.5 trillion.
However, interest rates have risen four times since the beginning of August last year which has begun to put pressure on some households' finances.
Interest rates rose to 5.5% last month and it is widely thought a further rate increase is on the cards before August.
These rate rises are expected to eventually take some of the steam out of the surging housing market and stabilise soaring property prices.
But with double-digit price growth reported by Nationwide for May, analysts remain tentative on calling when a slowdown may occur.