There was a whopping 15.1 per cent fall in house purchase mortgage approvals in May, taking the total to the lowest in two years according to e.surv chartered surveyors.
The firm says this reflects uncertainty in the run-up to the election, as it is based on submissions made during the previous month.
There were 57,813 house purchase mortgage approvals in May, 15.1 per cent fewer than the 68,076 recorded in April.
As a result, May represents the quietest month for house purchase lending since April 2013 (55,573).
Previously, April saw a 9.9 per cent monthly increase as high-end buyers pushed through sales in an attempt to circumvent the threat of a potential Mansion Tax.
On an annual basis, last month’s approvals were 6.4 per cent below the 61,737 seen in May last year.
“It takes time to ratify a mortgage – the rebuilt, post-MMR mortgage market requires stringent checks and balances before things can progress – meaning there’s a lag in the time it takes for these effects to register. May saw the delayed effect of this election uncertainty” says Richard Sexton, director of e.surv.
The number of higher-LTV house purchase approvals (to borrowers with a deposit worth 15 per cent or less of their property’s total value – typically first time buyers) has fallen in line with total house purchase approvals, but remains stable as a proportion of the market.
There were 9,366 higher LTV loans in May, down 15.6 per cent compared to the 11,096 seen in April, and four per cent lower than the 9,754 loans recorded in May last year.
However, as a proportion of the market, the number of higher LTV loans stood at 16.2 per cent in May this year, falling by just 0.1 percentage point since April.