Sharp recovery of mortgage approvalsMake Text Bigger
The latest Bank of England statistics for money and credit in September indicate the mortgage market strengthened further from its recover post lockdown. Net an additional £4.8 billion was borrowed secured on homes, following on from net borrowing of £3.0 billion in August. This reflects increased levels of mortgage approvals for house purchases over the last few months.
Mortgage borrowing bottomed out at net £0.2 billion in April but has since recovered reaching levels slightly higher than the average of £4.0 billion in the six months to February 2020. The total gross borrowing for September was £20.5 billion, but still below the February level of £23.4 billion.
The number of mortgage approvals for house purchases in September rose sharply to 91,500 from 85,500 in August. This was the highest number of mortgage approvals since September 2007, and is 24% higher than approvals in February 2020.
Approvals in September were close to 10 times higher than May with only 9,300.
Remortgage approvals for remortgage fell slightly at 32,700, and remain 38% lower than in February 2020.
The effective interest rates reflecting actual interest rates paid by borrowers on newly completed, and the outstanding stock of, mortgages remained pretty static in September with new mortgage rates increasing 0.02% on the month to 1.74%, while the interest rates on the stock of mortgage loans fell 0.01% to 2.13% in September.
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