Mortgage approvals down in December

Mortgage approvals fell significantly last month, new figures have revealed, adding to calls for a reduction in interest rates by the Bank of England.

Figures published by Connells Survey and Valuation indicated a 23 per cent drop in approvals between November and December 2007, falling to 66,000 in total, building.co.uk reported.

The statistics represent a 43 per cent fall compared to the same period a year previously, with the survey compilers citing the effects of the credit crunch, reduced buyer confidence and issues relating to the introduction of Home Improvement Packs.

"Unsurprisingly there are no signs that December’s base rate cut has provided a catalyst for improvement and we urge the Bank of England to implement the next cut in rates in February to help start the process of restoring confidence to the markets," Ross Bowen, the company's managing director, told the website.

Despite these latest figures, separate research published earlier this weekby the Council of Mortgage Lenders revealed that gross mortgage lending hit record levels of the course of 2007.

The total amount of money approved for house purchases hit £372 million, a five per cent increase over 2006's £365 million.

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