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UK mortgage approvals at highest rate since 2014
This article is an external press release originally published on the Landlord News website, which has now been migrated to the Just Landlords blog.
Mortgage approvals in Britain during July hit their greatest level since February 2014, according to new figures released by the Bank of England.
Data from the report shows that there were 68,764 mortgage approvals during the month, a rise of 16,4% since November’s low of 59,100.[1]
Rising
Experts suggest that these figures show that the housing market is beginning to return to its pre-recession rates, with mortgage approvals rising in five of the last seven months. House prices are also rising.
In addition, net mortgage lending was up by £2,709bn during July, which represents the greatest increase since July 2008.[1]
Chairman of the Intermediary Mortgage Lenders Association, Charles Haresnape, also noted that this total is the largest since the introduction of the Mortgage Market Review. ‘With 7% more approvals compared with the six month average, it is a clear indication that health is returning to a market that has been under significant pressure to perform while adjusting to new working practices,’ Haresnape noted.[1]
UK mortgage approvals at highest rate since 2014
Uncertainty
Mr Haresnape went on to warn that with European Mortgage Credit Directive rules starting to come in effect this month, there is likely to be extra uncertainty ahead for the market.
‘With more regulation on the way and a potential rise in the cost of borrowing on the cards, the six month window to implement the MCD rules will be a challenge for all concerned,’ he said.
‘On the positive side, rising approvals suggest consumer appetite is strong and lenders will also be striving to meet their end of year targets, which should support some competitive deals. We must hope that the impacts of change do not weigh down too heavily on what otherwise looks like a strengthening market recovery,’ Haresnape added.[1]
Howard Archer, chief economist at IHS Global Insight, said that it was possible that July’s performance was raised by house buyers looking to lock in low mortgage rates, before interest rates rise.
‘On the positive side, rising approvals suggest consumer appetite is strong and lenders will also be striving to meet their end of year targets, which should support some competitive deals. We must hope that the impacts of change do not weigh down too heavily on what otherwise looks like a strengthening market recovery,’ Archer explained.[1]
[1] http://www.propertywire.com/news/europe/uk-mortgage-approvals-rise-2015090110929.html
