The Bank of England found that October mortgage approvals dropped by 74 per cent since October 2007 – 32,000 mortgages were approved, 1,000 fewer than in the previous month.
Total net lending to individuals in October reached £1.3 billion, which was lower than September’s £1.8bn and also lower than the previous six-month averages.
Mortgage lending was down to £0.5bn, again lower than the September increase of £1.5bn and the previous six-month averages of £2.7bn.
Remortgaging unsurprisingly rose in October to 72,000, 1,000 more than September’s remortgage figures.
RICS chief economist Simon Rubinsohn says: “The continuing lack of activity in the housing market is clearly demonstrated by the latest mortgage approvals data from the Bank of England which remain at historically low levels.
“First time buyers and homeowners alike are still struggling to buy a property as banks are still requesting sizable deposits, further stagnating the property market, this will continue unless banks begin to loosen up on lending conditions. The lack of transactions in the property market is now taking its toll on the high street with spending on a wide range of consumer durable goods plummeting.
“This has been reflected not just in the collapse in MFI but poor trading news from most other retailers. The Bank of England will need to cut rates further this week for any chance of getting the mortgage market moving.”