The Bank of England’s latest credit conditions survey has painted a gloomy picture, with the number of mortgage deals already falling before the mini-budget on 23 September.
Lenders reported that the availability of secured credit to households - mortgages - decreased in the three months to end-August 2022 (Q3) and they expect the availability of secured credit to decrease further over the next three months to end-November 2022 (Q4).
“We are at the end of the golden age for cheap mortgages and with further interest rate rises seemingly around the corner, home ownership is set to become more costly for many of those on the property ladder and those reaching for the first rung,” said Myron Jobson, senior personal finance analyst at interactive investor.
The BoE survey showed that lenders reported that the availability of unsecured credit to households - personal loans, credit card borrowing - slightly decreased in Q3 and was expected to decrease further in Q4.
Lenders reported that the overall availability of credit to the corporate sector was unchanged in Q3, remaining unchanged for businesses of all sizes with a slight decrease expected in Q4.
Jobson added: “It is a worrying sign of finances being stretched and financial resilence being tested like never before among many of those relying on loans and plastic.”