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| Version 0 | Version 1 |
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| Mortgage approvals still falling | Mortgage approvals still falling |
| (20 minutes later) | |
| The number of new mortgages being approved for home buying fell again in November, says the Bank of England. | The number of new mortgages being approved for home buying fell again in November, says the Bank of England. |
| Its latest figures show that just 83,000 new mortgages were approved for home buyers last month. | Its latest figures show that just 83,000 new mortgages were approved for home buyers last month. |
| That was down from 89,000 in October and was the lowest monthly figure since the start of 2005. | That was down from 89,000 in October and was the lowest monthly figure since the start of 2005. |
| The further drop suggest that the recent sharp slowdown in the UK housing market is likely to continue well into the New Year. | The further drop suggest that the recent sharp slowdown in the UK housing market is likely to continue well into the New Year. |
| "The housing market is cooling, but in line with expectations," said Ross Walker, an economist at the Royal Bank of Scotland (RBS). | "The housing market is cooling, but in line with expectations," said Ross Walker, an economist at the Royal Bank of Scotland (RBS). |
| 'Generally fall' | 'Generally fall' |
| Although house prices in the UK ended 2007 roughly 5-8% higher than they started, prices started falling towards the end of the year under the impact of higher interest rates. | Although house prices in the UK ended 2007 roughly 5-8% higher than they started, prices started falling towards the end of the year under the impact of higher interest rates. |
| This ...maintains pressure for another interest rate cut sooner rather than later Howard Archer, Global Insight | |
| Soaring prices have also pushed the cost of homes out of reach of many potential first-time buyers. | Soaring prices have also pushed the cost of homes out of reach of many potential first-time buyers. |
| As a result, many experts and commentators now expect that prices will fall generally this year or, at best, stay level over the course of the next 12 months. | As a result, many experts and commentators now expect that prices will fall generally this year or, at best, stay level over the course of the next 12 months. |
| Although the Bank of England recently cut interest rates, and is widely expected to do so again this year, the housing market is now feeling the effect of the increases in borrowing costs that the Bank imposed from the summer of 2006 onwards. | Although the Bank of England recently cut interest rates, and is widely expected to do so again this year, the housing market is now feeling the effect of the increases in borrowing costs that the Bank imposed from the summer of 2006 onwards. |
| Cautious lending | Cautious lending |
| This week the Bank reported that the recent financial crisis in the banking system had led banks to be more cautious and cut back their lending, whether it be to home buyers, companies or people with credit cards. | This week the Bank reported that the recent financial crisis in the banking system had led banks to be more cautious and cut back their lending, whether it be to home buyers, companies or people with credit cards. |
| Part of that process has seen a drop in the number of people cashing in on the increased value of their homes to borrow more money. | Part of that process has seen a drop in the number of people cashing in on the increased value of their homes to borrow more money. |
| In November there were just 60,000 such loans secured on a property, the lowest number since the start of 2001, and exactly half the record number of 120,000 that were lent in October 2003. | In November there were just 60,000 such loans secured on a property, the lowest number since the start of 2001, and exactly half the record number of 120,000 that were lent in October 2003. |
| This suggests that consumer spending generally will slow down this year as much of this borrowing, known as housing equity withdrawal, goes to subsidise people's general spending. | This suggests that consumer spending generally will slow down this year as much of this borrowing, known as housing equity withdrawal, goes to subsidise people's general spending. |
| "Housing market activity is now slowing markedly in the face of stretched affordabilityas well as the tightening lending practices resulting from the credit crunch," said Howard Archer of Global Insight. | |
| "This ongoing evidence that the housing market is currently slowing markedlymaintains pressure for another interest rate cut sooner rather than later," he added. |