Mortgage approvals data gives an excellent indicator of where the housing market is right now, and it is not in a healthy place. Approvals continue to crash, effectively closing off credit to many prospective buyers. Without the oxygen of credit, the current elevated level of prices can not survive.
The mortgage approvals trend is now well established. In fact, it is so well established that it is becoming a little repetitious posting it each month. Nevertheless, I feel somewhat committed putting out a chart as the data comes out each month.
Today's charts focus only on approvals for home purchases rather than remortgages or other mortgage activity (mainly BTL). As the charts indicate, the collapse is nothign short of catastrophic.
The number of mortgage approvals is just a tadge over 20 thousand; back in the early part of 2007, the number was just below 80 thousand.
This can only mean one thing; house prices are about to fall off a cliff.