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Mortgage approvals rise by 9% in March

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The number of mortgages approved by the main high street banks in March increased by 9.1% year-on-year, data has shown.

The number of approvals for home purchases rose by 9.3% year-on-year to 42,328 in March 2019, according to the latest figures released by UK Finance.

The data also showed that remortgages were 11.1% higher at 30,063 during March.

Nevertheless, gross mortgage lending across the residential market dipped by 0.5% year-on-year in March to £20bn.

When it comes to spending activity amongst Brits, a total of £10.5bn of credit card spending was recorded in March. This represents an 8.1% increase compared with the same month in 2018, whilst personal loans were 6.8% higher year-on-year. On a positive note, this figure is well below the levels of personal borrowing recorded in March 2017.

More lenders target self-employed

Andrew Montlake, director of mortgage broker Coreco, said  his firm has seen a huge surge in mortgage enquiries this week.

“Whereas, three to six months ago, Brexit uncertainty held many prospective buyers and sellers in shackles, those shackles are increasingly off. There’s always a surge in activity levels during the Spring but this year it has been accentuated by the pent-up demand caused by Brexit,” he explained.

“Lender competition has never been as fierce as it is now and borrowers are reaping the rewards. What we’re also seeing is more and more mainstream and niche lenders target the self-employed in a bid to get funds into the market. If you’re self-employed, there has never been a better time to take out a mortgage,” he added.

Likewise, he said first-time buyers continue to make hay while the sun shines, supported by the Help to Buy scheme and lower property prices.

“Those who aren’t buying are remortgaging in order to improve their homes, and many are picking up an even more competitive rate as they do so,” he added.

Jeremy Leaf, north London estate agent and a former RICS residential chairman, said the figures confirm what his firm has been seeing on the ground.

“Transactions are holding up reasonably well despite political and economic distractions as might be expected at this time of year.

“However, it is still tough to find common ground between even realistic buyers and sellers, and sales are certainly taking considerably longer, not least because as we are finding, buy-to-let investors have not been replaced completely by first-time buyers.

“The picture is very patchy and can vary considerably between areas which are quite close together and between London and elsewhere,” he explained.

Brexit getting less attention

Gareth Lewis, commercial director of property lender MT Finance, puts subdued gross lending figures down to Brexit uncertainty.

“However, as far as the second quarter of the year and beyond is concerned, if the levels of activity we are seeing are anything to go by, the picture may be changing. With Brexit pushed back, far enough away for people to forget about it a little, and with fewer column inches in the papers, this is all a positive as it stops people from worrying about it too much.

They are getting on with life, looking at opportunities to improve their portfolios – from an investment point of view, Brexit is getting less attention now, which has to be a good thing,” he explained.