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Slow mortgage market could spell good news for borrowers

21 February 2005
Research by the British Bankers' Association (BBA) has revealed that mortgage lending by British banks slowed in January - which could spell good news for borrowers as banks offer new financial incentives to animate the market.

The BBA found that the rise in underlying mortgage lending rose by £4.4 billion last month, showing a marked slowdown from December's £5.1 billion increase.

The bankers' group went on to predict that the housing market would continue to cool off for some months.

This prediction is fuelled further by separate figures from the Building Societies Association (BSA), which found that mortgage approvals - the value of loans not yet made - were down to £3.2 billion, a 13 per cent year on year decrease.

"We are now experiencing the widely predicted market slowdown," BSA director general Adrian Coles told Sky News.

Mr Coles went on to reassure borrowers, however, stating: "it is notable that over the last three months lending has been broadly stable - a good indication that fears of a sudden crash are overstated."

Borrowers may also look forward to fresh financial incentives from banks and building societies keen to reanimate the slowing mortgage market.

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