Mortgage lending at lowest level in 11 months according to Bank of England
The number of mortgages approved in May dropped to its lowest level in eleven months - the latest indication that stricter lending rules are slowing down lending in the property market.
According to data released by the Bank of England, Mortgage approvals for house purchases totalled 61,707 in May, down from 62,806 in April. The May figure was a fifth below January's peak of 76,000.
The Mortgage Market Review (MMR), introduced in April to ensure buyers are able to afford their mortgage, is considered a significant factor in slowing down mortgage approvals. Under the new MMR regulations, lenders have been instructed to increase the stringency of the checks they make on borrowers, including detailed questions about spending habits.
Last week, Bank of England governor Mark Carney proposed a cap on the proportion of home loans that can be lent at high multiples of household income and further strengthened affordability checks on prospective borrowers in an attempt to cool the market.