FILE PHOTO: A general view of The Bank of England and the Royal Exchange as the spread of the coronavirus disease (COVID-19) continues, in London, Britain, March 19, 2020. REUTERS/Hannah McKay/File Photo
LONDON (Reuters) – British mortgage approvals slumped to the lowest on record in May, data from the Bank of England showed on Monday, underscoring the scale of the hit to the housing market from the coronavirus lockdown.
The number of mortgage approvals fell to 9,273 – the lowest since comparable records began in October 1997 – from 15,851 in April which was already sharply lower than in previous months.
Economists polled by Reuters had expected approvals to rise to 25,000 in May. Before the coronavirus pandemic and the government’s closure of the housing market – which was only lifted in mid-May in England – they were running at more than 70,000 a month.
The data also showed a further net repayment of consumer credit of 4.6 billion pounds ($5.7 billion) in May as people remained largely stuck at home and spent less, although the pace of the repayment slowed from April.
The BoE reported a further big rise in the amount of money households and companies hold in their bank accounts which increased by 52.0 billion, compared with increases of about 67 billion and 38 billion pounds in March and April.
That compared with an average monthly increase of 9.3 billion pounds in the six months to February, before the coronavirus crisis escalated.
($1 = 0.8106 pounds)
Writing by William Schomberg, editing by Andy Bruce