"That demand could be set to continue as we exit the second national lockdown, with many borrowers still looking to secure lending before the March deadline."
Approvals are now 33% higher than in February 2020 and around 10 times higher than the trough of 9,400 approvals in May. Approvals for remortgaging with a different lender were broadly unchanged in October, at 32,900, and remain around 40% lower than in February 2020.
Net mortgage borrowing remained robust at £4.3 billion in October, following borrowing of £4.9 billion in September. Mortgage borrowing troughed at £0.2 billion in April, but has since recovered and is slightly higher than the average of £3.9 billion in the six months to February 2020.
Vikki Jefferies, proposition director at Primis Mortgage Network, commented: “The mortgage industry continued to show positive signs of recovery in October, with today’s figures showing that approvals increased further last month. Incentives such as the Chancellor’s stamp duty holiday have gone a long way towards driving buyer appetite, while the pent-up demand that succeeded the housing market’s hiatus has further contributed to the industry’s recovery.
“However, while the market continues to work hard to ensure that borrowers can progress with their applications, it’s crucial for advisers to keep protection front of mind during their conversations with clients. Many customers continue to face financial hardship as a result of the pandemic and are, understandably, looking for solutions which can protect them and their families from further difficulty. It is in an adviser’s best interest to ensure that their clients’ finances are adequately protected so that families are properly supported, both during this period and beyond.”
Rob Barnard, director of intermediaries at Masthaven, added: “October was clearly still an incredibly busy time for the housing market. Despite the Covid restrictions, the stamp duty Holiday has continued to fuel activity in the market. That demand could be set to continue as we exit the second national lockdown, with many borrowers still looking to secure lending before the March deadline.
“However, the pandemic has wreaked havoc on the personal finances of many consumers across the UK and it’s likely that there will now be thousands more borrowers who could find themselves excluded from high street lenders. Specialist lenders will clearly have an important role to play supporting these borrowers in the months and years ahead, and it is vital that we work collaboratively with mortgage brokers to ensure these underserved customers find the right financial solutions that fit their needs.”
