U.K. lenders approved the fewest mortgages in almost three years in December as a Bank of England interest-rate increase added to the headwinds facing the housing market.
The number of approvals fell to 61,039, down from the 64,712 in November and the lowest since January 2015, the U.K. central bank said on Tuesday. At the same time, unsecured credit grew by 1.5 billion pounds ($2.1 billion), in line with the average of the previous six months.
The housing market has reflected the fortunes of the economy since the 2016 vote to leave the European Union, as a sterling-induced pickup in inflation squeezed the pockets of consumers. The slowdown has been most pronounced in London, where property prices are rising at their weakest pace in six years, according to Hometrack.
At the start of November the BOE pushed up the cost of buying a home by raising its benchmark for the first time in more than a decade. The interest rate on new mortgages climbed above 2 percent last month.