Rate rise hits mortgages

MORTGAGE lending fell to a four- and- a- half year low last month after the Bank of England raised interest rates.

There were 36,115 loans approved for house purchases in December – the lowest number since April 2013 and down 19pc on the same month in 2016.

The slump came after the Bank raised interest rates from 0.25pc to 0.5pc in November – the first hike for more than a decade.

in a further sign that the housing market is struggling, estate agent Foxtons said that its profits for 2017 would be down 39pc at around £15m.

The company, which does most of its business in London, blamed ‘a significant fall in sales’ in the first quarter of last year following tax hikes on buy-to-let properties and second homes.

Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said the Bank had ‘seriously misjudged the ability of the housing market to withstand even modest increases in rates’.