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Drop in mortgage approvals

Date: Thu, 18 Nov 04 Analysis

A new study has found that the economic climate is continuing to slow down as mortgage approvals dropped significantly in the last month.

The research by the Council of Mortgage Lenders (CML) found that approvals fell by over 25,000 to 90,000 during October compared with figures for the same period last year.

Analysts have suggested that the continued downward turn in mortgage approvals will convince the Bank of England to hold interest rates at 4.75 per cent for the foreseeable future.

Many consider the CML's survey to provide the best indicator of future demand for housing and the October results mean it appears that there will continue to be a cooling in the housing market in the coming months.

The news comes despite recent statements from numerous house builders expressing confidence in the market and projecting increased building during 2005.

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