Figures that were recently released by the Bank of England have shown that for the month of January mortgage approvals for property purchases levelled out, standing steady at 31,000.

Mortgage approval levels have now averaged 31,000 for the past six months according to the central bank, suggesting that the slump in mortgage lending may have reached its peak. However, approval levels are still at just half the level they were at a year ago.

Amongst the problems that would be buyers are experiencing in the mortgage market at present is the high level of deposit being demanded by lenders, which many simply cannot afford.

One official said that the “disconnect between buyer enquiries and actual mortgages approved highlights the inability of many buyers to access the property market at the present time because of the substantial deposits being sought by lenders. Subsequent announcements by both Northern Rock and RBS indicate that a little more funding will flow into the mortgage market over the coming months but as things stand, this will only boost the available finance by in the region of 10% compared with 2008.”

Another industry expert said that first time buyers were really suffering at present, stating: “Once again the number of deals available for those with a 10% deposit has fallen and with the average fixed rate today standing at 6.31%, they are far from competitive. In comparison, someone with a 40% deposit can get an average rate of 4.84%. First time buyers… are meant to be the lifeblood of the property market, but at the moment there is no incentive for them to get on the first rung of the property ladder.”

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