Gross mortgage lending across the residential market in September was £21.5bn, approximately 1.2% lower than the figure posted a year earlier, according to the latest statistics from UK Finance.

The number of mortgages approved by the main high street banks in September was also down by 9.1% when compared to September 2017. Approvals for house purchase dropped by 10.1%, while remortgage approvals were 7.4% lower and approvals for other secured borrowing down by 9.8%.

UK Finance reported there was £10bn worth of spending on credit cards in September, representing a 3.4% increase compared to last September. Over the past twelve months, the outstanding level of credit card borrowing has grown by 5.7%, while personal borrowing through loans and overdrafts increased by 2.3% in the year to September, although it has seen a net contraction in the last two months.

Personal deposits in total grew by 0.9% over the past year. A consumer preference to hold cash for immediate use is reflected in instant access deposit levels being 3.1% higher than last September.

Commenting on the data, UK Finance managing director of personal finance Eric Leenders said: “The mortgage market softened slightly in September, following strong remortgaging activity in the months preceding the recent base rate rise.

“There has been modest year-on-year growth in card spending. However, borrowing through personal loans and overdrafts has contracted slightly in recent months, suggesting demand for unsecured household finance is becoming more subdued.

“Consumers are increasingly choosing to keep cash close to hand, with deposits held in instant access accounts showing steady growth.”

Landbay CEO John Goodall added: “Mortgage lending has slowed down in recent months, suggesting a wider deceleration in the market. Landlords have historically found themselves targets of the budget, so all eyes are on next week’s announcement.

“Regulatory changes, extortionate stamp duty, and Brexit have all contributed to a slump in the mortgage market. It is clear that now is not the time for the Chancellor to make changes or he runs the risk of further damaging the private rental sector. The only sweetener would be a reduction or removal of stamp duty, which would provide a much needed boost for the market.”

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