There were 74,453 approvals for house purchase, marking the lowest figure since July 2020.
The number of mortgage approvals made to home buyers dipped to the lowest levels in a year in August, Bank of England figures show.
There were 74,453 approvals for house purchase, marking the lowest figure since July 2020 – the month that a temporary stamp duty holiday was put in place.
The stamp duty holiday in England and Northern Ireland has been tapered since July, reducing the potential savings that can be made. It will end completely from October 1.
Simon Gammon, managing partner at Knight Frank Finance, said: “Borrowing remains well above pre-pandemic norms, and current levels of activity suggest it will remain so throughout the autumn.
“Mortgage rates on the high street have continued to edge down, though the trend of banks undercutting each other that we’ve seen during recent months has given way to them simply matching each other. That suggests the mortgage war is beginning to peter out.
“Instead, we’re seeing lenders loosen criteria in order to bring in new customers.”
Jeremy Leaf, a north London estate agent and a former residential chairman of the Royal Institution of Chartered Surveyors (Rics), said: “As always, mortgage approvals are a good lead indicator of purchasing intentions.
“However, because they reflect decisions made in the period leading up to August, they show demand remaining relatively healthy even though the final stamp duty holiday and furlough deadlines were looming large.
“We are finding that activity has reduced since but certainly not fallen off a cliff, so expect fairly consistent mortgage approval numbers for the rest of the year at least.”
Mark Harris chief executive of mortgage broker SPF Private Clients, said: “August proved to be quieter for the housing market compared with the relative frenzy of previous months, with many people putting their property searches on hold and going on holiday.
“Mortgage rates continue to fall as lenders, awash with cash, compete for business, which should help support the market into the autumn.
“Indeed, we are finding that September is proving to be a record-breaking month with plenty going on as buyers continue to search for more space, both inside and out.”