BoE: Mortgage approvals up 21%

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Mortgage approvals rose 21.2 per cent year-on-year in December, from 102,910 to 124,803, according to new Bank of England figures.

The total value of approvals rose 31.5 per cent, from £15.2bn in December 2014 to £20bn last December.

House purchase approvals rose 18 per cent year-on-year in December to 70,837 from 60,275. The value of these approvals was £12.3bn in December 2015, up 26 per cent year-on-year.

Remortgage approvals increased 27 per cent in the final month of the year, from 32,847 in December 2014 to 41,708. The value of remortgages was £7.1bn last December, up from £5.1bn in the same period of 2014.

The number of approvals for other purposes was 12,258 in the final month of 2015, up 26 per cent from 9,723 in December 2015.

Freedom Finance managing director Nicola Georgiou says: “The spike in [house purchase] approvals to 70,837 indicates that many are in a rush to complete before the new stamp duty tax rules comes into force in April this year.

“It is encouraging to see that consumers are taking advantage of the competitive low rates on offer, but it is important that prospective borrowers are aware that many of the top rates being advertised are only available to those with perfect credit scores.”

E.Surv director Richard Sexton says: “The end of 2015 saw a steady flow of lending to homebuyers, with healthy monthly totals reflecting improved finances, aided by a year of low inflation and rising wages. But these supportive economic conditions can only go so far, and the recovery is being hindered by lack of available homes from sellers.

“Speeding up the homebuilding process is essential, and updating our antiquated planning system would help this along.”