UK mortgage approvals fall to lowest level since June 2020

UK mortgage approvals fell to the lowest level in more than two years in November, as rising prices and higher borrowing costs put a strain on household spending.

According to data from the Bank of England, mortgage approvals to fund house purchases fell to 46,100 in November, down from 57,900 the previous month.

The figures was the lowest for mortgage approvals since June 2020, and less than the 55,000 estimated by economists polled by Reuters.

The figures underscore the turmoil in the UK housing market, sparked by the September 23 “mini” Budget of then-prime minister Liz Truss, which prompted some lenders to withdraw home loans.

The BoE said the interest rate paid on new mortgages rose 26 basis points to 3.35 per cent in November, the highest mortgage rate since 2013.

The rise in mortgage costs follows a string of interest rate increases from the BoE’s Monetary Policy Committee, as it tries to tackle high inflation.