Number of mortgage approvals made to home buyers jumps to nine-month high
The number of mortgage approvals made to home buyers jumped to a nine-month high in March, figures from a trade association show.
There were 39,980 approvals for house purchase, marking the highest total since June 2018, according to UK Finance.
Meanwhile 29,448 re-mortgage loans got the green light in March – the highest figure since August 2018.
UK Finance said personal deposits grew by 0.4% in the year to March, with savers’ money held in instant access accounts growing at a faster annual rate, of 2.0%.
This reflects consumers’ preference to keep cash close at hand amid ongoing economic uncertainty, UK Finance said.
Howard Archer, chief economic adviser at EY ITEM Club said: “UK Finance reported mortgage approvals for house purchases somewhat surprisingly edged up to a nine-month high of 39,980 in March…
“The housing market has been constrained for an extended period by overall challenging conditions – relatively limited consumer purchasing power, despite recent improvement, after an extended squeeze and fragile consumer confidence.
“It should be noted that the overall national picture has been dragged down by the particularly poor performance in London and parts of the South East.”
Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said looking ahead, mortgage lending is likely to continue to “flatline”.
Mr Tombs said: “Mortgage rates look set to hold steady, keeping the proportion of home buyers’ incomes absorbed by loan payments at historically low levels.
“Nonetheless, households’ overall confidence still is low and surveys show a marked deterioration in households’ view that housing is a good investment, which only will have been strengthened by the recent slowdown in house price growth.
“It’s hard to see lending returning to 2013-to-15 levels any time soon.”
Jeremy Leaf, a north London estate agent and a former residential chairman of the Royal Institution of Chartered Surveyors (Rics), said: “It is still tough to find common ground between even realistic buyers and sellers, and sales are certainly taking considerably longer, not least because as we are finding, buy-to-let investors have not been replaced completely by first-time buyers.
“The picture is very patchy and can vary considerably between areas which are quite close together and between London and elsewhere.”
Andrew Montlake, director of mortgage broker, Coreco, said: “There has been a marked improvement in the property market in the past month or so.
“Something has changed, and this week in particular has seen a huge surge in mortgage inquiries.”
He continued: “There’s always a surge in activity levels during the spring but this year it has been accentuated by the pent-up demand caused by Brexit…
“Those who aren’t buying are re-mortgaging in order to improve their homes, and many are picking up an even more competitive rate as they do so.”