The number of mortgages being approved for home-buyers fell significantly in September against a backdrop of rising borrowing costs. The Bank of England said mortgage approvals for house purchases decreased from 74,400 in August to 66,800 in September.
A large chunk of mortgage products disappeared from the market when former chancellor Kwasi Kwarteng unveiled his mini-budget on September 23, with lenders raising the prices of their home loans. Rises in the Bank of England base rate have also pushed up mortgage rates.
Alice Haine, personal finance analyst at investment platform Bestinvest, said: “The panic in the market in the first three weeks of September might have been driven by rising interest rate expectations – with the Bank of England increasing the base rate by 50 basis points on September 22 to 2.25% – but the situation escalated dramatically when former chancellor Kwasi Kwarteng unveiled his radical fiscal plan of unfunded tax cuts a day later.
