Mortgage approvals bounced back during February as confidence returned to the housing market, figures showed today.
A total of 37,305 home loans were approved for people buying a property during the month, the highest level since September last year, according to the British Bankers’ Association.
There was also a jump in the number of people remortgaging as the highly competitive deals on offer tempted homeowners to switch loans.
Overall, 18,357 mortgages were approved for people remortgaging, up from 17,055 in January.
A total of 37,305 home loans were approved for people buying a property during the month, the highest level since September last year, according to the British Bankers’ Association.
There was also a jump in the number of people remortgaging as the highly competitive deals on offer tempted homeowners to switch loans.
Overall, 18,357 mortgages were approved for people remortgaging, up from 17,055 in January.
Richard Woolhouse, chief economist at
the BBA, said: “The increase in mortgage approvals is welcome news and a
sign that the housing market is beginning to improve.
“We’re seeing stronger demand for mortgages as consumers take advantage of some of the very competitive deals currently available.”
But despite the improvement in approvals levels, the total of 61,361 pipeline loans for all purposes, including equity release, was still 20 per cent lower than in February last year.
There was also a pick up in advances during the month, with net lending, which strips out redemptions and repayments, rising to £508m, up from £402m in January.
The BBA figures come as mortgage lender Halifax reported a surge in optimism in the housing market.
The group’s Confidence Tracker rebounded from an 18-month low of +52 in January to +60 in February.
Both buyers and sellers were upbeat about the market’s prospects, with both measures reaching record highs.
Buying sentiment increased to +35, while selling sentiment stood at +27.
But despite the increase in confidence, consumers still remain cautious, with 57 per cent predicting house prices will remain flat or rise by just 5 per cent during the coming 12 months.
At the same time, 43 per cent of people think mortgage rates will be higher in a year’s time than they are now, despite the fact that the Bank of England’s Monetary Policy Committee has signalled that a hike to the Bank Rate remains some way off.
Craig McKinlay, mortgages director at Halifax, said: “With inflation now at its lowest level since records began and the chances of the next interest rates change reportedly just as likely to be down as up, consumers are feeling more optimistic about the housing market again.
“The traditional slow start to the year for the housing market has already begun to give way to increased activity, but consumers remain relatively cautious.
“For sustainable long-term growth we need a period of stable growth and a more comprehensive house-building programme.”
Meanwhile, a combination of Government schemes means first-time buyers can now buy a £200,000 property after saving just £8,000 towards a deposit.
The Government’s Help to Buy scheme enables people to purchase a new build property with a deposit of just 5 per cent, with the Government providing a five-year interest free loan for 20 per cent.
At the same time, under the new Help to Buy Isa, announced in the Budget, the Government will top up savings of £200 a month with a £50 bonus.
“We’re seeing stronger demand for mortgages as consumers take advantage of some of the very competitive deals currently available.”
But despite the improvement in approvals levels, the total of 61,361 pipeline loans for all purposes, including equity release, was still 20 per cent lower than in February last year.
There was also a pick up in advances during the month, with net lending, which strips out redemptions and repayments, rising to £508m, up from £402m in January.
The BBA figures come as mortgage lender Halifax reported a surge in optimism in the housing market.
The group’s Confidence Tracker rebounded from an 18-month low of +52 in January to +60 in February.
Both buyers and sellers were upbeat about the market’s prospects, with both measures reaching record highs.
Buying sentiment increased to +35, while selling sentiment stood at +27.
But despite the increase in confidence, consumers still remain cautious, with 57 per cent predicting house prices will remain flat or rise by just 5 per cent during the coming 12 months.
At the same time, 43 per cent of people think mortgage rates will be higher in a year’s time than they are now, despite the fact that the Bank of England’s Monetary Policy Committee has signalled that a hike to the Bank Rate remains some way off.
Craig McKinlay, mortgages director at Halifax, said: “With inflation now at its lowest level since records began and the chances of the next interest rates change reportedly just as likely to be down as up, consumers are feeling more optimistic about the housing market again.
“The traditional slow start to the year for the housing market has already begun to give way to increased activity, but consumers remain relatively cautious.
“For sustainable long-term growth we need a period of stable growth and a more comprehensive house-building programme.”
Meanwhile, a combination of Government schemes means first-time buyers can now buy a £200,000 property after saving just £8,000 towards a deposit.
The Government’s Help to Buy scheme enables people to purchase a new build property with a deposit of just 5 per cent, with the Government providing a five-year interest free loan for 20 per cent.
At the same time, under the new Help to Buy Isa, announced in the Budget, the Government will top up savings of £200 a month with a £50 bonus.
As a result, first-time buyers would only need to save
£8,000 to get the £10,000 deposit they needed for a £200,000 home bought
through the Help to Buy scheme, the Daily Mail said.
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