The lending figures were 15.2 per cent lower then October 2003 and represented the second year-on-year fall.
Compared to the same month last year approvals of house purchase loans were 35 per cent lower by number and 32 per cent lower by value; remortgaging loans were 16 per cent lower by number and 5 per cent lower by value; and equity withdrawal loans were 46 per cent lower by number and 45 per cent lower by value.
David Dooks, BBA director of statistics, said: “The weakening demand for both mortgage lending and consumer credit seen over the last few months continued in October and weak approvals data suggest that this pattern will be maintained in the short-term.
“With mortgage lending volumes slowing it is not surprising that competition among lenders is intensifying and at the same time, borrowers are looking to reduce their borrowing costs. As a result, remortgaging is holding up and accounted for a high 39 per cent of all approvals in October.”
Guy Batchelor, director of sales and marketing at Britannia’s intermediary lender Platform, commented: “These figures come as no surprise, especially as most brokers spent September preparing for regulation.
“That combined with the slowdown in the housing market means that we will probably see even lower figures for October.”
However he predicted that the market would see an improvement in the New Year as lenders launched new and innovative products.
Richard Verdin, director of Enable, said: “We have seen different lenders reporting drops in volume since regulation and this is the first clear evidence of this.
“Although things will also appear slow for October we have a number of brokers who have seen a pick up in business. I don’t think things will get any worse.”
