Mortgage Lending Hits Lowest Level Since 2016
Mortgage lending in February fell to its lowest level since 2016, excluding the pandemic, the Bank of England has said.
But the number of mortgages approved by lenders rose slightly, suggesting the slowdown may be stabilising.
It comes as higher borrowing costs make buying property less affordable.
Homeowners borrowed £700m in February, down from £2bn in January, the Bank said. That is the lowest level since April 2016 apart from the Covid crisis.
However, mortgage approvals rose to their highest level for three months, climbing to 43,500 in February from 39,600 in January.
Mortgage rates began to rise last year as interest rates climbed, but they spiked in September after Liz Truss's mini-budget caused panic on financial markets.
Rates have stabilised but remain much higher than they were a few years ago, squeezing people's purchasing power.
It has fed through to house prices, which in the year to February saw their biggest annual fall in more than ten years, according to Nationwide.
Nevertheless, the Bank of England forecast that fewer households were likely to struggle to afford mortgage payments this year than previously forecast due to falling energy prices.
In December it warned 670,000 households could face difficulties.