Slight dip in July purchase approvals

July is typically a slow month for house lending, but this year there were only 500 fewer loans than in June, new Bank of England figures show.

Strong lending during the summer slowdown suggests the lending market has returned to “robust health”, according to Richard Sexton, director of e.surv chartered surveyors.

July saw 66,569 loan approvals for house purchase, slightly down from June’s 67,085 and down from an average of 67,563 over the last six months.

The total value of dwelling-secured loans has increased steadily since May to £16.6bn in total in July, according to the figures from the Bank of England’s money and credit statistics report.

Approvals for remortgaging were also up to 32,983 in July compared to the average of 32,446 over the previous six months. Approvals for other purposes numbered 10,853, down from the six-month average of 11,317.

Sexton comments: “A large proportion of house purchase lending was to high loan-to-value borrowers in July – about a fifth of house purchase approvals.

“Despite the economic recovery, many borrowers are still struggling to put together the deposit they need to purchase property.

“Help to Buy is still needed to support borrowers outside of the capital, particularly in regions where the recovery is still limping rather than racing along.”

Mark Harris, chief executive of mortgage broker SPF Private Clients, says: “One would expect the mortgage market to slow down towards the end of July and through August as it is traditionally a quiet time of year when not much gets done.

“However, we had one of our best months for new business – emphasising the continued strength of the London property market in particular.”