Remortgaging approvals were hit hardest, falling 5.5% to 44,775 – a second consecutive monthly drop. Meanwhile there were 64,768 purchase approvals, down slightly from 65,374 in June.
The figures were also down even more significantly compared to July 2017, with house purchases down 6% and the total number of mortgages down 4.8% lower.
However, gross lending values grew by £1bn compared to June to hit £22.8bn for July, but this was broadly in-line with figures for 2018 so far.
The BoE noted that the annual growth rate for mortgage lending remained unchanged at 3.2% in July, and has now been around 3% since late 2016.
“Although this is above the growth rate between 2009 and 2013, it remains modest compared to the pre-crisis period,” it said.
Mortgage Advice Bureau reported a settled if patchwork mortgage lending view today reflecting the strength of the broker side of the lending market and the reporting time lag between completions and applications reflected by the broker figures.
Lack of demand
The results prompted frustration from industry commentators as they revealed a lack of market growth in a typically busy period.
“These figures are a little disappointing in that they reflect a period when we would have expected a pick-up in the market over the spring buying season,” said North London-based estate agent Jeremy Leaf.
“Buyers and sellers are still engaged in a stand-off, whereas lack of energised demand has meant there is often very little urgency to complete deals, even when terms have been agreed.”
He added that there were regional variations and that there was hope the next few months would see greater activity.
Primis and Personal Touch financial services proposition director Vikki Jefferies was a little more relaxed.
“It’s no surprise to see that mortgage lending has experienced a dip this month, as the effect of the Bank of England’s August rate rise won’t kick in until September – especially when it comes to remortgages.
“However, even though some borrowers may be tempted to take action before rates rise again, the threat of a ‘no-deal’ Brexit has many customers nervous.”