Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your experience. Save up to 40% More details

UK mortgage lending resumes after tax break blip, consumers cautious

Economic IndicatorsSep 29, 2021 05:31AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters. FILE PHOTO: A general view shows The Bank of England in the City of London financial district in London, Britain, November 5, 2020. REUTERS/John Sibley/File Photo

By William Schomberg

LONDON (Reuters) - British mortgage lending rose last month, recovering from a rare fall in July which was linked to the scaling back of a tax break for homebuyers, but consumers remained cautious about their borrowing, Bank of England data showed on Wednesday.

Net mortgage lending increased by 5.293 billion pounds ($7.24 billion) in August, bouncing back from July's net repayment of 1.758 billion pounds. New mortgage approvals fell slightly to 74,453.

A Reuters poll of economists had pointed to a net rise of 3.7 billion pounds in mortgage borrowing in August and to 73,000 mortgage approvals during the month.

Britain's housing market has boomed since the summer of 2020, helped by a pandemic surge in demand for bigger properties as more people work from home and by the tax incentive offered by finance minister Rishi Sunak.

That incentive was halved in scale on July 1 for home-buyers in England and Northern Ireland and is due to expire completely at the end of this month. Similar tax breaks in Scotland and Wales have already ended.

Wednesday's data showed consumer borrowing also rose in August, increasing by a net 351 million pounds after a rise of just 32 million pounds in July. The economists polled by Reuters had expected a smaller rise of 300 million pounds.

Nonetheless, consumer credit was 2.4% lower than in August 2020, underscoring how many households remained cautious about their spending over the summer when COVID-19 cases picked up again and many people were required to isolate at home.

Economists say further momentum is likely to be lost in the coming months due to rising inflation and supply chain problems linked to the reopening of the economy, chief among them a lack of truck drivers which is hampering fuel supplies.

"Overall, we're becoming more worried that economy may soon take a step back," Paul Dales, an economist at Capital Economics said. "That would be food for thought for the Bank of England which appears intent on raising interest rates in the coming months."

UK mortgage lending resumes after tax break blip, consumers cautious

Related Articles

Egypt PMI steady in Nov as input costs rise
Egypt PMI steady in Nov as input costs rise By Reuters - Dec 04, 2021 1

CAIRO (Reuters) - Egyptian non-oil activity in the private sector shrank for a 12th month in November as inflation expectations rose, causing new business orders to fall by their...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email