Borrowing is 'slowing down'

New analysis of lending figures for February show that amid "tighter conditions for personal disposable income", people are borrowing less.

The British Bankers Association (BBA) study shows that as prices rise, consumers desire to get involved in the housing market is calming.

The average approved mortgage has climbed 14 per cent in one year to £150,400 and jumped £50,000 over the past four years.

David Dooks, BBA director of statistics said: "The UK’s shortage of housing market supply is clearly evident in the mortgage approvals data. The last £50,000 rise in the average house purchase loan has occurred more than twice as quickly as the previous £50,000 increase."

He said that demand was slowing down and that for the third month running house purchase approvals were lower than they were last year.

While the value of approvals for new house purchases has increased by eight per cent since February 2006, the number of approvals has dropped by five per cent.

A similar trend is to be seen in credit cards, with new borrowing down seven per cent on last year.

Mr Dooks said: "Reflecting tighter conditions for personal disposable income, consumer credit continues to be weak."