Approvals figures fell from 64,152 in June offering the lowest tally since January 2015. Mortgage lending also fell to £10.4bn down from £11.1bn in June.
Mark Harris, chief executive of mortgage broker SPF Private Clients, said July and August are always traditionally quieter times of the year for the market; the real test will come in September when people get back from holiday.
He added: “Remortgaging is likely to go from strength to strength. This is not so much because borrowers fear a rate rise, as it looks as though they are more likely to go the other way – rather mortgage deals are so cheap, in particular fixed rates, it is a good opportunity to snap one up. What remains to be seen is how long lenders retain their appetite to lend at such low rates.”
Richard Pike, sales and marketing director of Phoebus Software, said: “A number of potential house buyers seem to have been put off buying in July; what remains to be seen is whether this is in fact the ‘Brexit effect’ or a normal seasonal downturn that will pick up in September. I expect there to be a further drop off in August’s figures so we will need to wait until the autumn to see if this is a pause for breath or the start of a more serious downturn.”
A survey from Shawbrook Bank showed mortgage adviser confidence is still resilient in the face of challenging business conditions and over half are still ‘fairly confident’ mortgage lenders will keep lending.
Overall high levels of broker confidence rest on a strong start to the year, with 64% of brokers seeing an increase in business volumes and 43% dealing with growing client demand compared with the second half of 2015.