Mortgages

Mortgage approvals beginning to fall: BoE

Net mortgage borrowing was slightly weaker in February, at £3.5 billion, and was slightly below the £3.8 billion average of the past six months.

Rozi Jones
|
29th March 2019
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"The only surprise might be that they didn’t fall back a lot more, bearing in mind Brexit and other distractions."

Mortgage approvals for purchase and remortgage both decreased in February following steady activity over the previous two months, according to the latest Money and Credit statistics from the Bank of England.

Purchase approvals fell back to 64,300, below the 66,800 recorded in January and also slightly below the average of 65,500 over the previous six months.

Approvals for remortgaging totalled 47,700, below the previous month's figure of 50,400 and the six month average of 49,500.

Individuals’ net borrowing through mortgages was slightly weaker in February, at £3.5 billion, and was slightly below the £3.8 billion average of the past six months.

Jeremy Leaf, north London estate agent and former RICS residential chairman, said: "It is no surprise that mortgage approvals for house purchase fell back slightly last month, according to Bank of England figures. In fact, the only surprise might be that they didn’t fall back a lot more, bearing in mind Brexit and other distractions.

"Looking forward, we have found on the ground that enquiries have increased. Buyers and sellers are fighting to come out of hibernation later than expected so there could be a reasonable upturn in mortgage approvals and sales over the next few months.

"Builders and developers in particular are demonstrating more optimism as we are receiving enquiries for development land where product will not be available for at least 12-18 months when the present fog will hopefully be a distant memory."

Nick Chadbourne, CEO at LMS, commented: “Over the next few months, it is likely we will see a surge in remortgage activity. April 2019 will have the highest product expiry rate for the past two years and the current low interest rates won’t last forever, so homeowners will be looking to take advantage of these deals while they last.

"We are already seeing customers choosing longer term products when remortgaging and it will be interesting to see if this trend continues throughout the year.”

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