Boom still not over as mortgage approvals hit 13-year high
The housing market may be slowing as we enter December but the latest snapshot suggests there’s still momentum with mortgage approvals at a 13 year high.
According to the Bank of England’s Money and Credit report, secured borrowing was an additional £4.3 billion in October - a figure that tops the average £3.9 billion in the six months to February 2020, during the so-called Boris Bounce.
The BoE also says approvals for house purchases went up to 97,500 in October from 92,100 in September – the highest figure since September 2007 and a third up on February 2020.
These Bank of England figures are typically seen as an indicator of market activity in the coming months.
“We expect the numbers to remain robust for at least the next month or two until the reduction in activity which we have noticed over the last few weeks as the stamp duty deadline draws close, begins to have an impact on transaction numbers. The underlying strength of the market does not appear to be waning, at least for the time being” notes Jeremy Leaf, the north London estate agent and a former RICS residential chairman.
Meanwhile David Ross, managing director of Zoopla data consultancy Hometrack, says: “Typically we expect this time of year to be quieter and, while our data shows a slowing down in new mortgage applications in November, this is the busiest pre-Christmas housing market for over a decade with 100,000 additional sales to be completed before the end of March 2021.”
And Mark Harris, chief executive of mortgage broker SPF Private Clients, adds: “With mortgages approvals at their highest level since September 2007, the market continues to be robust. But the circumstances are very different to 2007; back then, those highs were followed by the credit crunch but this time around there is far more scrutiny on mortgage underwriting and the assessment of affordability. This, combined with historic low interest rates, mean we should not see a repeat of that crisis.”Source Graham Norwood_www.estateagenttoday.co.uk >