Housing market suffers winter chill
Gross mortgage borrowing also fell by 5.5% year-on-year to stand at £10.1bn despite mortgage stock increasing by 1.6% from a year ago.
Richard Woolhouse, BBA’s chief economist, said: “Today’s figures show quite a sharp chill to the housing market in recent months.”
Mortgage borrowing has averaged £10.8bn in the six months prior to November, while it stood at £10.4bn in October.
Peter Rollings, chief executive of Marsh & Parsons, said: “The contours of the UK housing market have shifted from the start of 2014, with property price rises softening into a more organic upward curve.
“New configurations of affordability checks and pre-emptive measures in the mortgage market temporarily diverted the route of lending, but overall progress is healthy.
“Mortgage products have never been more attractive, and with plentiful choice of properties and now smaller up-front Stamp Duty costs, buyers are faced with a very favourable set of conditions.”
Andy Knee, chief executive of LMS, said: “2014 has been an up and down year with the ramifications from MMR, Help to Buy, tighter regulation and constant speculation about a base rate rise all being felt – and the latest statistics from the BBA seem to support this.
“With the election looming next year, housing is likely to be a priority for all political parties and it will be interesting to see how they tackle the challenges facing the sector.
“Further signs of a slowing in house price growth will – on the whole – come as a welcome sign but for many, buying a house or upsizing remains far out of reach.”
The statistics also revealed that unsecured borrowing such as personal loans has grown at its fastest rate for six years.
Mark Harris, chief executive SPF Private Clients, said: “With the tough MMR rules now really having an impact, more borrowers are turning to unsecured borrowing as they struggle to get the mortgages they need.
“The changes to Stamp Duty should provide a modest fillip in the spring but we expect uncertainty around the general election to keep the housing market fairly subdued until after May.
“Once the election result is known, we expect the pent-up demand from the start of the year to be released and the year overall to be a strong one, with around £215bn of lending.
He added: “However, there are problems with the implementation of the MMR which need resolving.
“The regulator must urgently address the issue of older borrowers, for example, many of whom are now struggling to get a mortgage.
“It is difficult to fathom why a lender would rather advance 95% loan-to-value to a first-time buyer with no track record than 50% to an older borrower with a 40-year unblemished track record.”