Home Commercial Property Mortgage approvals double in July to £2.7bn

Mortgage approvals double in July to £2.7bn

by LLP Finance Reporter
3rd Sep 20 11:20 am

The mortgage market showed more signs of recovery in July, but remained weak in comparison to pre-Covid, according to the latest Money and Credit statistics from the Bank of England.

Mortgage approvals increased to 66,300, up from 39,900 in June. Approvals are now 10% below the February level of 73,700, but more than seven times higher than the trough of 9,300 in May.

Approvals for remortgaging with a different lender are little changed compared to June, at 36,000. They remain 30% lower than in February.

Net mortgage borrowing was £2.7 billion in July, higher than the £2.4 billion in June but below the average of £4.2 billion in the six months to February 2020. The increase on the month reflected a slight increase in gross borrowing to £17.4 billion in July, below the pre-Covid February level of £23.7 billion.

Hugh Wade-Jones, managing director of Enness Global Mortgages said, “The latest rate of mortgage approvals is really quite astonishing given the dire position of the market just a few short months ago. There is no doubt that the huge surge of buyer demand seen once the market reopened has been seriously turbo-charged due to the stamp duty holiday announced shortly after. With the combination of both causing buyers to return to the market at mass.

“As a result, we’ve seen the number of people approved for a mortgage rebound from the depths of pandemic paralysis in May to hit almost the same levels as this time last year in just two months, with the current trajectory sure to return the market to pre-lockdown levels in no time.

“The rate of this return to form really shouldn’t be underestimated and these notably heightened levels of buyer demand should prove just the medicine for the UK property market, reversing any pandemic decline in house price growth seen during lockdown.”

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