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Mortgage Approval High

30.10.19

Residential mortgage approvals reached their highest level of approvals registered during October since 2015, up 9.8% higher annually, the latest industry figures show.

The data from UK Finance shows that there were 42,300 home buyers entering the market during the month.

The latest figures demonstrate a very real appetite for home ownership across the UK and mark the sixth consecutive month that mortgage approval levels exceed a healthy 42,000, according to Anita Mehra, managing director of Benham and Reeves.

‘This suggests that despite our political system continuing to crumble from the inside out, the Brexit ice is starting to melt when it comes to buyer sentiment and their intent to purchase,’ she said.

‘While we may have to wait until the other side of the festive break to see this intent materialise into actual sales, it bodes well for the wider market given that our future in or out of Europe is yet to receive any concrete stamp of certainty,’ she added.

But Dilpreet Bhagrath, mortgage expert at online mortgage broker Trussle, pointed out high rents and current property prices relative to income are still an issue for most first time buyers. ‘While there are Government-backed schemes to help first time buyers, more needs to be done to improve greater access to the market. Both Government and the industry need to step up and deliver innovative solutions to make mortgages simple and get people on the property ladder,’ said Bhagrath.

Jeremy Leaf, north London estate agent and a former RICS residential chairman, explained that at first glance, these figures look remarkably good considering present Brexit shenanigans, even though they do reflect what was happening in the market a few months previously.

‘But when you look more closely it is clear that the market was particularly flat this time last year, which is giving an unrealistic shine to this September’s numbers. Nevertheless, they demonstrate that buyers and sellers are carrying on regardless albeit at more realistic price levels. Otherwise deals are simply are not happening,’ he added.

Mortgage lending and approvals up on last year is a sign of the release of pent up demand across the property market, according to Tom Mundy, chief operating officer of Goodlord.

‘People who were hanging around waiting for Brexit uncertainty to dissipate can’t wait forever and are now deciding to move on with their lives, driving this uptick in mortgage applications,’ he said.

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