(Repeats to fix technical glitch)
By Ana Nicolaci da Costa
LONDON May 27 Britain's banks last month
approved the lowest number of mortgages since August 2013 in the
latest sign that the housing market is losing some momentum,
although prices remain strong.
Economic recovery and record-low interest rates have driven
British house prices up by about 10 percent over the past year,
raising concern some buyers might be taking on too much debt.
The British Bankers' Association said its members approved
42,173 mortgages in April, falling for a third straight month
and down from 45,045 in March.
New tighter rules on mortgage lending are widely believed to
have dampened borrowing in recent months.
Mortgage lending was up 24.5 percent compared with April
last year, slowing sharply from previous months, the BBA said on
However, net mortgage lending was at its highest in nearly
three years and the average value of mortgages was near a record
high, suggesting the rate of price growth could still become a
The Bank of England is expected to announce further mortgage
controls, possibly as soon as the June meeting of its Financial
Policy Committee which was set up to help avert recklessness in
the financial system.
Bank of England officials have become more vocal about their
concerns with the housing market in recent weeks, especially the
risk of households taking on too much debt.
The BoE is due to publish its own mortgage lending data for
April on June 2, after two consecutive months of falling
Matthew Pointon, a property economist at consultancy Capital
Economics, said the FPC would probably look at whether the new
mortgage rules had brought down loan-to-income ratios.
"Today's release does ring one alarm bell - the average
mortgage value increased again to close to a record high. Action
to ensure that underwriting standards do not ease any further
therefore remains a distinct possibility," he said.
The average value of loans for house purchases rose to
164,500 pounds ($277,100) in April - its highest since 166,600
in June 2012, which was a record high.
Last week, British bank Lloyd's said it would limit
mortgages to a maximum of four times a borrower's annual
earnings when it is lending more than 500,000 pounds on a
Net mortgage lending reached 1.08 billion pounds in April -
its highest since August 2011 and up from 1.00 billion pounds in
The BoE said last week that policymakers had noted falls in
the central bank's measure of mortgage approvals in February and
March but it was too soon to know if that was the result of the
"Our figures show that housing market is mixed," said
Richard Woolhouse, chief economist BBA.
"The amount of borrowing is however still well below the
levels we were seeing before the financial crisis."
The BoE has said it would adopt further controls on mortgage
lending before it resorts to interest rate rises to deal with
the housing market. Interest rates are expected to rise in the
first half of 2015.
($1 = 0.5936 British Pounds)
(Reporting by Ana Nicolaci da Costa; editing by William