Mortgage approvals bounce back in September
According to the Bank’s latest Money and Credit statistics, mortgage approvals totalled 118,470 in September with a value of £19.1bn, compared to 113,524 and £17.6bn a month earlier.
The number of approvals for house purchase reached 62,932 with the value at £11.1bn, up from August’s figures of 60,984 and £10.4bn but still lower than the six-month average of 64,481. Meanwhile remortgaging approvals totalled 42,440, also down on the six-month average of 41,882 but higher than 40,366 in August.
However, figures for gross mortgage lending reversed a trend recorded in August when lending continued to rise while approvals dwindled. According to the Bank’s figures, mortgage lending amounted to £18.9bn in September, down from £19.6bn in August.
The Bank’s lending figures resonate with those published by the Council of Mortgage Lenders for September, which showed that lending contracted by 7% from August to total £20.5bn.
Richard Pike, director at Phoebus Software, said: “The purchase market is more subdued which could be down to supply rather than appetite. It is well documented that demand continues to outweigh supply, which is a situation that has no quick fix. As we saw in the GDP figures last week, construction output is down, despite all efforts. We do need to be moving much faster to keep up with demand; the worrying question is do we have the capacity, skilled labour and materials to build the number of houses we need?
“Nonetheless, the likelihood is that we will continue to see modest growth, especially in this last quarter. As Help to Buy 2 comes to a close, those with smaller deposits will have to move fast to take advantage of the scheme, which could mean a surge in first-time-buyer activity.”