UK mortgage approvals and lending declined in October as buyers brought forward their borrowing to September to take advantage of stamp duty holiday, official data revealed Monday.
Approvals for house purchases fell to 67,200 in October from 71,900 in September, the Bank of England said. This was the lowest since June 2020 and also below the expected level of 71,250.
Net borrowing of mortgage debt by individuals totaled GBP 1.6 billion in October, down from GBP 9.3 billion in September. This was the lowest since July 2021.
The bank said October's decrease was driven by borrowing brought forward to September to take advantage of stamp duty land tax relief, before it was completely tapered off.
Individuals borrowed GBP 0.7 billion in consumer credit in October versus economists' forecast of GBP 0.4 billion. The majority of this was GBP 0.6 billion of additional borrowing on credit cards, which was the strongest net borrowing since July 2020.
Further, data showed that borrowing of non-financial businesses was GBP 0.4 billion in October compared to a net repayment of GBP 0.4 billion in September.
Net borrowing by large non-financial businesses was GBP 2.0 billion in October versus GBP 1.1 billion in September. Small and medium sized non-financial businesses repaid GBP 1.6 billion, on net, rising from a GBP 1.5 billion net repayment in September.