Mortgage approvals in UK drop to lowest in over a year after tax break ends
LONDON: The number of mortgages approved by British lenders for house purchase fell more than expected in April to their lowest in over a year as the market adjusted to higher purchase taxes.
Earlier government data showed that British house purchases surged in March to take advantage of the final month of an exemption from
stamp duty land tax
for many buyers, before slumping in April when the tax reverted to its normal rate.
Mortgage approvals - which are typically given at least a month before a purchase completes - fell to 60,463 in April from a downwardly revised 63,603 in March. This was the lowest total since February 2024 and below economists' expectations in a Reuters poll of a smaller fall to 63,000.
Net mortgage lending fell by 759 million pounds ($1.03 billion) in April - the largest monthly drop since January 2024 - after a 12.957 billion pound rise in March.
This weakness may prove temporary. Earlier on Monday, Nationwide Building Society -
Britain
's second-largest mortgage lender - reported faster than expected house price growth in May and said underlying demand remained strong due to low unemployment and wages outstripping inflation.
However, consultancy Capital Economics said April's drop represented the third consecutive drop in mortgage approvals and the decline might not all be due to buyers bringing forward purchases to beat the tax deadline.
Ruth Gregory, Capital's deputy chief economist, said she saw downside risks to her forecast of 3.5% annual house price growth for the fourth quarter of 2025.
Nationwide's data showed prices up 3.5% in the year to May.
The BoE data also showed unsecured consumer lending rose by a net 1.580 billion pounds - above economists' 1.1 billion pound forecast - and the annual growth rate rose to 6.7% from March's 6.2%, the fastest growth since October 2024.
Capital viewed this as a sign that British domestic consumer demand remained strong despite downbeat headlines in April around U.S. President Donald Trump's tariff plans, while KPMG interpreted it as evidence that households had come under strain from an outsize rise in household bills in April.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
&w=3840&q=100)
First Post
31 minutes ago
- First Post
US suspends licenses to ship nuclear plant parts to China amid trade tensions
The United States has suspended licenses allowing companies to export nuclear power plant equipment to China. The move, taken by the US Department of Commerce, marks a sharp escalation in the ongoing trade and technology war between the two superpowers. read more The U.S. in recent days suspended licenses for nuclear equipment suppliers to sell to China's power plants, according to four people familiar with the matter, as the two countries engage in a damaging trade war. The suspensions were issued by the U.S. Department of Commerce, the people said, and affect export licenses for parts and equipment used with nuclear power plants. Nuclear equipment suppliers are among a wide range of companies whose sales have been restricted over the past two weeks as the U.S.-China trade war shifted from negotiating tariffs to throttling each other's supply chains. It is unclear whether a Thursday call between U.S. President Donald Trump and Chinese President Xi Jinping would affect the suspensions. STORY CONTINUES BELOW THIS AD The U.S. and China agreed on May 12 to roll back triple digit, tit-for-tat tariffs for 90 days, but the truce between the two biggest economies quickly went south, with the U.S. claiming China reneged on terms related to rare earth elements, and China accusing the U.S. of 'abusing export control measures' by warning that using Huawei Ascend AI chips anywhere in the world violated U.S. export controls. After Thursday's call, further talks on key issues were expected. The U.S. Department of Commerce did not respond to a request for comment on the nuclear equipment restrictions. On May 28, a spokesperson said the department was reviewing exports of strategic significance to China. 'In some cases, Commerce has suspended existing export licenses or imposed additional license requirements while the review is pending,' the spokesperson said in a statement. The Chinese Embassy in Washington did not immediately respond to a request for comment. U.S. nuclear equipment suppliers include Westinghouse and Emerson. Westinghouse, whose technology is used in over 400 nuclear reactors around the world, and Emerson, which provides measurement and other tools for the nuclear industry, did not respond to requests for comment. The suspensions affect business worth hundreds of millions of dollars, two of the sources said. They also coincide with Chinese restrictions on critical metals threatening supply chains for manufacturers worldwide, especially America's Big Three automakers. Reuters could not determine whether the new restrictions were tied to the trade war, or if and how quickly they might be reinstated. Department of Commerce export licenses typically run for four years and include authorized quantities and values. STORY CONTINUES BELOW THIS AD But many new restrictions on exports to China have been imposed in the last two weeks, according to sources, and include license requirements for a hydraulic fluids supplier for sales to China. Other license suspensions went to GE Aerospace for jet engines for China's COMAC aircraft, sources said. The U.S. also now requires licenses to ship ethane to China, as Reuters reported first last week. Houston-based Enterprise Product Partners said Wednesday that its emergency requests to complete three proposed cargoes of ethane to China, totaling some 2.2 million barrels, had not been granted. Reuters could not determine whether the new restrictions were tied to the trade war, or if and how quickly they might be reinstated. Department of Commerce export licenses typically run for four years and include authorized quantities and values. But many new restrictions on exports to China have been imposed in the last two weeks, according to sources, and include license requirements for a hydraulic fluids supplier for sales to China. STORY CONTINUES BELOW THIS AD Other license suspensions went to GE Aerospace for jet engines for China's COMAC aircraft, sources said. The U.S. also now requires licenses to ship ethane to China, as Reuters reported first last week. Houston-based Enterprise Product Partners (EPD.N), opens new tab said Wednesday that its emergency requests to complete three proposed cargoes of ethane to China, totalling some 2.2 million barrels, had not been granted.
Time of India
32 minutes ago
- Time of India
China okays rare earth licences to suppliers of top three US auto companies
Live Events (You can now subscribe to our (You can now subscribe to our Economic Times WhatsApp channel BEIJING/WASHINGTON: China has granted temporary export licenses to rare-earth suppliers of the top three US automakers, two sources familiar with the matter said, as supply chain disruptions begin to surface from Beijing's export curbs on those least some of the licenses are valid for six months, the two sources said, declining to be named because the information is not public. It was not immediately clear what quantity or items are covered by the approval or whether the move signals China is preparing to ease the rare-earths licensing process, which industry groups say is cumbersome and has created a supply bottleneck. China's decision in April to restrict exports of a wide range of rare earths and related magnets has tripped up the supply chains central to automakers, aerospace manufacturers, semiconductor companies and military contractors around the dominance of the critical mineral industry, key to the green energy transition, is increasingly viewed as a key point of leverage for Beijing in its trade war with US President Donald Trump . China produces around 90% of the world's rare earths, and auto industry representatives have warned of increasing threats to production due to their dependency on it for those of three big US automakers, General Motors Ford and Jeep-maker Stellantis got clearance for some rare earth export licenses on Monday, one of the two sources and Ford each declined to comment. Stellantis said it is working with suppliers "to ensure an efficient licensing process" and that so far the company has been able to "address immediate production concerns without major disruptions."China's Ministry of Commerce did not immediately respond to a faxed request for comment. China's critical-mineral export controls have become a focus on Trump's criticism of Beijing, which he says has violated the truce reached last month to roll back tariffs and trade restrictions. On Thursday, Trump and Chinese President Xi Jinping had a lengthy phone call to iron out trade differences. Trump said in social-media post that "there should no longer be any questions respecting the complexity of Rare Earth products." Both sides said teams will meet again auto companies are already feeling the impact of the restrictions. Ford shut down production of its Explorer SUV at its Chicago plant for a week in May because of a rare-earth shortage, the company said.
&w=3840&q=100)
Business Standard
an hour ago
- Business Standard
Oil prices rise on US jobs data and renewed China trade discussions
Crude rose more than $1 a barrel on Friday morning and oil prices were on track for their first weekly gain in three weeks after a favorable US jobs report and resumed trade talks between US President Donald Trump and Chinese leader Xi Jinping, raising hopes for growth in the world's two largest economies. Brent crude futures gained $1.28, or 1.96 per cent, to $66.62 a barrel by 1649 GMT. US West Texas Intermediate crude climbed $1.34, or 2.11 per cent, to $64.71. On a weekly basis, both benchmarks were on track to settle higher after declining for two straight weeks. Brent has advanced 2.75 per cent this week, while WTI is trading 4.9 per cent higher. "I think the jobs report was Goldilocks," said Phil Flynn, senior analyst with the Price Futures Group. "It was not too hot, not too cold but just right to increase the chances for an interest rate cut by the Federal Reserve." The US Labor Department's monthly employment report showed the unemployment rate held steady at 4.2 per cent last month. Employers added 139,000 jobs, which combined with downward revisions to prior months' estimates showed a cooling in labour demand but nothing abrupt; by comparison, job gains averaged 160,000 last year. A rate cut by the US central bank, much desired by the Trump administration, is seen as a way to increase spending, raising demand for petroleum. Flynn also said the planned output hike announced by OPEC+ to begin in July would likely be absorbed by higher demand, keeping supply tightly balanced with demand. China's official Xinhua news agency said trade talks between Xi and Trump took place at Washington's request on Thursday. Trump said the call had led to a "very positive conclusion", adding the US was "in very good shape with China and the trade deal". Canada also continued trade talks with the US, with Prime Minister Mark Carney in direct contact with Trump, according to Industry Minister Melanie Joly. The oil market continued to swing with news on tariff negotiations and data showing how trade uncertainty and the impact of the US levies are flowing through into the global economy. "The potential for increased US sanctions in Venezuela to limit crude exports and the potential for an Israeli strike on Iranian infrastructure add to upside risks for prices," analysts at BMI, a Fitch affiliate, said in a note on Friday. Top exporter Saudi Arabia cut its July crude prices for Asia to near two-month lows. That was a smaller price reduction than expected after OPEC+ agreed to ramp up output by 411,000 barrels per day in July. The kingdom had been pushing for a bigger output hike, part of a broader strategy to win back market share and discipline over-producers in OPEC+, which groups the Organization of the Petroleum Exporting Countries and allies including Russia. "The market looks balanced in 2Q/3Q on our estimates as oil demand rises in summer and peaks in July-August, matching supply increases from OPEC+," HSBC said in a note. "Thereafter, accelerated OPEC+ hikes should tip the market into a bigger 4Q25 surplus than previously forecasted," the bank added. (Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
