Mortgage approvals suffer sharp January fall

Mortgage approvals dropped by almost 10,000 in January, according to the latest monthly figures from the British Bankers' Association (BBA).

House purchase approvals were 35,083 last month, down from 45,650 in December. Remortgaging approvals fell almost 3,500 to 20,252 in the same period.

The BBA says the level of approvals were weak due to an inflated market in December as borrowers pushed through transactions ahead of the removal of Stamp Duty relief.

It also blamed the cold weather for deterring would-be home buyers.

David Dooks, BBA statistics director, says: "There was a natural reaction in the January figures and the bad weather further suppressed market activity."

Andrew Montlake, director at mortgage broker Coreco, says he expects stronger figures from February as activity had begun to pick up towards the end of last month.

"January's figures should not dampen the spirits as the mortgage market has got off to a flyer compared to this time last year, with hundreds of new products hitting the market and enquiry levels rising dramatically," he says.