Lending slows down but mortgage approvals increase

01/03/2007

In January mortgage lending increased by the weakest amount in 4 months. However approvals for fresh home loans increased from a different perception the housing market is not struggling unduly after interest rates increased three times just after August period.

On Thursday the Bank of England stated that lending connected on dwellings increased by 9.567bn pounds January period. It was lower than 10.3bn pounds increase December period and the 10.05bn leap suggested by investigators.

However mortgage approvals increased to 120,000 from 114,000 December period. This summery was good news and analysts feel that the mortgage market will keep on increasing more and more as the year follows.

Philip Shaw, chief at Investec "The mortgage lending numbers were weaker than expected but we would argue that the mortgage approvals number is probably the more accurate gauge of the current state of the mortgage market."

The sterling increased when data was totalled during the same time as new data of a step down in factory activity took place.

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