According to recent figures released by the British Banker’s Association, the level of mortgage approvals for the month of April are the second lowest on record, coming in at only marginally higher than the all time low figure for March. In March mortgage approval levels fell to the all time low of 35.346. Whilst there was a slight improvement for April the level of mortgage approved over the month has come in at the second lowest on record, standing at 38.704.

Officials state that the figures is way below the average for the last six months, and a whopping 40% lower than mortgage approval levels for the same period last year. One industry official stated: “March was the record low and April is the second lowest ever so you cannot call that a recovery. The housing market remains extremely weak.”

With house prices having fallen for eight consecutive months, with recent reports indicating that they are now around 4.4% lower than this period last year, and with credit conditions becoming increasingly tight, both the mortgage and the housing markets have been thrown into chaos over recent months since the onset of the global credit crunch last summer. Mortgage loan approvals are falling due to more stringent borrowing regulations from lenders, as well as due to a reduction in application levels due to increased caution from would-be buyers who are nervous about house prices plummeting further.

An official from the British Banker’s Association stated: “Pressures on household finances, stalling house prices and tighter lending criteria in response to lower liquidity are all constraining demand for house purchase and equity withdrawal loans, which are both well down on levels last year. In contrast, there is an active remortgaging market as people switch lenders to obtain better deals.”