Mortgage approvals up in March

The number of UK mortgage approvals increased from 49,000 in February to 49,900 in March, according to the latest figures from the Bank of England.

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The figure was however lower than the previous six-month average of 53,103.

The number of approvals for remortgaging – 29,511, also increased in March but was lower than the previous six-month average of 31,799.

While the number of approvals for other purposes – 18,528, was down slightly in March and was also lower than the previous six-month average of 20,162.

Within total lending, lending secured on dwellings rose by £1.0bn, in line with the previous six-month average increase.

Samuel Tombs, UK economist at Capital Economics, says: “Today’s UK money and lending figures suggest that the banking system remains a significant constraint on the pace of economic recovery. Granted, the number of mortgages approved for new house purchase rose from 49,000 to 49,900 in March.

“Nonetheless, this still leaves them lower than the levels seen in the second half of last year.

“And although RICS reported that new buyer enquiries picked up in March, credit conditions are continuing to tighten and news of the return to recession can only have dampened consumer confidence.

“Meanwhile, both the money supply and bank lending posted sharp monthly falls of 0.8% and 0.5% respectively in March. This sent the annual growth of both to new record lows. Finally, the CIPS/Markit construction PMI fell from 56.7 to 55.8 in March, adding to signs that the economy started the second quarter on a weaker footing.”