Reports that mortgage approvals fell for the second month in a row, despite lenders stepping up offers to borrowers, have done nothing to dispel previous protestations from economists that a future property crash is unlikely.
Approvals were down 1.6% on the previous month in March, Bank of England figures show, with a total of 66,837 mortgages approved for house purchases and the number of loans approved for those re-mortgaging also falling.
This is despite lenders engaging in increasingly competitive price wars bringing unprecedented deals to market in recent weeks, such as Yorkshire Building Society launching the lowest ever rate to market and HSBC the cheapest five-year fix on the market.
Meanwhile, a report earlier in the week also showed that the ‘Bank of Mum and Dad’ is now the 10th biggest UK mortgage lender, with parents set to lend £6.5bn over the course of this year, according to figures released by Legal & General.
This is up from the £5bn of lending estimated in L&G’s equivalent survey a year ago, with research suggesting parents will provide support for more than 298,000 mortgage deposits.
In pensions, some of Britain’s biggest companies are facing “difficult discussions” over increasing pension deficits, with the combined pensions deficit amongst firms in the UK FTSE 100 index increasing by 13% in the past year alone, according to a leading pensions consultancy.
JLT Employee Benefits has said the news could cause problems when some firms carry out pension re-valuations in the coming months, with Tesco and Lloyds Bank among those re-valuing their pension schemes as a result.
Required to measure the deficit or surplus activity of their defined benefit pension schemes every three years, JLT reported this week that the combined pension funds deficit of FTSE 100 companies was £60bn in April, up from £53bn a year ago.
In investments, local election gains for the ruling Conservatives gave London shares a small lift on the same day as the count was revealed. It was also announced that retail veteran and former Conservative MP Archie Norman will take over from Robert Swannell as incoming chairman at Marks and Spencer, sending shares up more than 4%. Mr Norman also served as the chairman of ITV alongside chief executive Adam Crozier, who also announced his departure earlier this week, and will assist recently-installed chief executive Steve Rowe in the turnaround of the high-street stalwart from September.
Consumer credit – such as personal loans, credit card borrowing and overdrafts – has also continued to grow at the rate seen in recent months, Bank of England figures show. With a reported 11% rise in loans and overdrafts in the 12 months to the end of March, the growth has led to declarations of “vigilance” from the Bank of England and other financial regulators.