Another drop in mortgage approvals
November 2007 showed just 83,000 people being approved for mortgages. That figure is less than the 89,000 mortgage approvals from October. The mortgage approval rate is now at the same level it was at the beginning of 2005.
It is reckoned that this drop in mortgage approvals will set the scene for 2008 as the housing market continues to slow down. House prices, despite still showing an increase, have definitely dropped the speed with which they were increasing in value.
By the end of 2007, house prices were between 5 and 8% higher than previous, but increased interest rates made sure prices slowly fell for the latter half of the year.
It is possible the Bank of England will still feel the need to cut the base interest rate again at some point this year which will hopefully ease the pressure.
This has had a knock on effect too as we are seeing a drop in secured loans which in turn leaves people with less money to spend, so we may see the high street suffering as a result too. Here's hoping things will turn out for the best.
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