UK mortgage approvals fall slightly more than expected in August

British mortgage approvals fell slightly more than expected in August, adding to signs that the housing market has cooled markedly over the past few months, according to official data on Monday.

The Bank of England said mortgage approvals numbered 64,212 last month, the weakest reading since May, and down from 66,100 in July.

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Analysts had forecast a modest fall in approvals to 65,000.

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Monthly mortgage approvals are still short of the 90,000 level seen before the 2008 financial crisis, and below a recent peak of more than 76,000 in January.

Recent surveys of the housing market have suggested the pace of its recovery has slowed, after rapid growth in activity and house prices at the start of the year.

The British Bankers' Association reported last week that the number of mortgages approved by its members fell to a 12-month low in August.

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Earlier this year, Governor Mark Carney said that housing was the biggest domestic threat to Britain's economic recovery, given the risk of borrowers taking on too much debt.

As well as the more exhaustive checks that banks are required to make on people seeking a mortgage which came into effect in April, the BoE announced in June that it was taking measures to prevent a build-up of risky debt.

The BoE has been seeking to cool the mortgage market since January when it refocused its Funding for Lending Scheme away from mortgage lending and dedicated it exclusively to business lending.

A survey from mortgage lender Halifax earlier this month showed growth of house prices slowed significantly in August.

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The BoE said lending to non-financial businesses increased by 817 million pounds in August, down from a 1.17 billion pound rise in July.

Lending to small businesses alone contracted by 301 million pounds, although the pace of decline eased from July's 434 million pound drop.

Unsecured lending to consumers rose by 898 million pounds in August, slightly above a Reuters poll forecast for 850 million pounds.

The BoE's preferred gauge of money supply, M4 excluding intermediate other financial corporations, rose 0.1 percent on the month, taking the annual growth rate to 3.5 percent.