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The Office for National Statistics (ONS) said that gross domestic product (GDP) increased by just 0.1% in July, a significant slowdown from the 1% growth seen the month before.

Many companies have faced problems with the pingdemic and shortages of materials. The construction sector has been hit especially hard with output dropping 1.6% in July. Retailers also saw declines and lawyers were affected by the tapering-off of the stamp duty holiday.

ONS deputy national statistician for economic statistics Jonathan Athow said: “After many months during which the economy grew strongly, making up much of the lost ground from the pandemic, there was little growth overall in July. Oil and gas provided the strongest boost, having partially bounced back after summer maintenance. Car production also continued to recover from recent component shortages.”

Mr Athow added: “The service sector saw no growth overall with growth in IT, financial services and outdoor events – which could operate more fully in July – offsetting large falls in retail and law firms.”

The arts, entertainment and recreation sector, however, saw a 9% increase following the lifting of social distancing measures on July 19

Economists had predicted a slowdown in GDP growth in July. However, this was an average forecast at 0.5%, according to Pantheon Macroeconomics. 

Mortgage sales for the UK decreased by £1.8 billion in July, down 10.8% on the previous month, according to Equifax Touchstone analysis of the intermediary marketplace.

Buy-to-let figures were resistant to the general decline, down by just 0.2% (£3.9 million) to £2.6 billion, while residential sales dropped by 12.8% (£1.8 billion) to £12.2 billion. Overall, mortgage sales for the month totalled £14.8 billion, up 10.8% year-on-year.

All regions across the UK suffered a significant fall in sales. Scotland suffered the biggest slump of 19.8%, followed closely by Northern Ireland (-18.5%), and the South East (-15.4%).

Regional area Total mortgage sales growth
Scotland -19.8%
Northern Ireland -18.5%
South East -15.4%
South Coast -13.9%
North East -12.9%
South West -11.8%
Midlands -11.4%
Wales -9.2%
London -8.4%
Home Counties -7.5%
North and Yorkshire  -7.0%
North West - 5.7%

John Driscoll, Director at Equifax Touchstone, said: “These figures show how volatile the mortgage market can be. Sales have tumbled in July, with every region suffering substantial declines as buyers are put off by continuing political and economic uncertainty, coupled with the worrying gap between inflation and wage growth. These circumstances may be further compounded by the potential for an interest rate hike as early as September, driven by continued pressure on the pound.

“On a more optimistic note, mortgage sales are up over 10% year-on-year and a dip in sales for July is not uncommon; however, as the summer period comes to a close, the long-term outlook for the market still remains very unclear.”

The data from Equifax Touchstone, which covers the majority of the intermediated lending market, shows that the average value of a residential mortgage in July was £199,286 (2016: £188,115) and £159,721 for buy-to-let (2016: £158,415).

Equifax Touchstone utilises intermediary and customer profiling tools to provide financial services providers with a detailed understanding of their marketplace and client base.

(Source: Equifax)

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