The number of loan approvals for house purchase was 61,760 in February, compared to the average of 60,750 over the previous six months, while the number of approvals for remortgaging was 32,099, compared to the average of 31,687 over the previous six months.
Mark Harris, chief executive of mortgage broker SPF Private Clients, said:
"February’s data reveals a consistently improving mortgage market with a greater number of loan approvals for house purchase and remortgaging compared to the average over the previous six months.
"Government schemes aimed at helping first-time buyers are proving to be hugely successful, with the Help to Buy ISA announced in the Budget set to raise awareness even further.
"The lack of inflation, and talk of an interest rate cut rather than a rise, could have an impact on people’s inclination to take on new debt. There are certainly plenty of cheap mortgage rates to tempt them. While Swap rates ticked up in past weeks, they have since fallen and with lots of capacity in the market as lenders such as HSBC and Tesco look to boost their offering via brokers, mortgage rates are likely to remain extremely competitive in the months to come."
Richard Pike, Phoebus Software sales and marketing director, added:
“The Bank of England’s money and credit report this morning has shown an increase in the number of mortgage approvals in February, which differs from the CML’s estimated figures released earlier this month.
"Although the CML seem correct in that the market is stabilising, it is evident from this morning’s release that the market is capable of growing again, perhaps earlier than many predicted with the general election only weeks away. Now that parliament has been dissolved it will be interesting to see if potential insecurity surrounding a new government has any effect on people’s appetite to buy or remortgage, especially when interest rates are expected to remain at their current levels for the foreseeable future.”
Brian Murphy, Head of Lending at Mortgage Advice Bureau, commented:
“Today’s data from the Bank of England shows that momentum is returning to the mortgage market with loan approvals for house purchases steadily climbing from month to month. Homebuyers are showing no signs of being dissuaded by uncertainty surrounding the election, and are taking advantage of market conditions that are ripe for borrowing at affordable rates.
“The combination of low inflation, moderating house price growth and a delay in the base rate rise seems to be working in consumers’ favour. Fierce competition between lenders is also a significant factor behind the rise in approvals. The emergence of more specialist lenders to compete with the high street brands means that, even with rigorous affordability checks in place, customers have more options than ever to explore getting a loan. Our own National Mortgage Index shows a record number of mortgage products were available in February* and this is undoubtedly helping to keep approval figures climbing.
“Remortgaging activity is also running above the six month average and the host of low rate deals available on the market should prompt a further pickup as more people take action – especially where they can reduce their mortgage repayments.”
