LONDON (Reuters) - British banks approved the smallest number of home loans in a year during August, industry data showed on Tuesday, adding to recent signs some of the heat in the housing market is fading.
The British Bankers’ Association said its members approved 41,588 loans for house purchases in August, down from 42,715 in July and the smallest number in 12 months.
Still, the number of loans approved was still about 5 percent higher compared with August 2013.
In terms of monetary value, the amount of net new mortgage lending in August rose to 1.12 billion pounds from a six-month low of 902 million pounds in July.
“Housing market activity appears to be moderating,” the BBA said in a statement.
Britain’s Financial Conduct Authority required lenders to introduce tighter affordability checks on mortgages in late April, and the Bank of England imposed further restrictions on how much most Britons can borrow in June.
“Though approval processes were temporarily disrupted by the implementation of the Mortgage Market Review in early 2014, recent figures suggest a stable overall picture of approval numbers.”
The BBA data does not include mortgages approved by building societies, a major part of the market. Bank of England data for all British mortgage lending in August is due on Sept. 29.
Surveys from the Royal Institution of Chartered Surveyors and mortgage lender Halifax released earlier this month suggest house price growth slowed sharply in August.
Reporting by Andy Bruce; Editing by Tom Heneghan