The latest data from the Bank of England reveals that October brought another increase in the number of residential mortgage approvals, marking the second month in a row that the total has gone up.
The total number of homebuyer mortgage approvals for the month went up to 97,500 from 92,000, with the Bank of England indicating that the figure for October represents the highest number in the UK since 2007. It is also an increase of 33% in comparison to the number of residential mortgage approvals that there were during February of 2020.
Purchase approvals for October came to a total value of £20.6 billion, while the total value of them in the month before was £19.5 billion. There was also another slight rise in the number of remortgage loans approved last month, with these hitting 32,900, compared with 32,800 for September. However, remortgage approvals were still 40% below what they were in February.
Speaking to Mortgage Strategy about the further monthly increase in mortgage approval numbers, the Managing Director of Coreco, Andrew Montlake, stated that the figures hitting the pre-financial crisis high of 2007 showed just how much build-up in demand the initial lockdown had created, adding.
“What’s vital is that lenders don’t become overly cautious and stop lending to borrowers with larger deposits. With a vaccine looming, lenders will hopefully avoid entering panic mode.”
Advisors will need to use the skills developed during their CeMAP courses to ensure that they find affordable loans for clients next year if the economic downturn sees lenders retreat.