Thanks to a surge before the general election, the number of mortgages approved reached its highest figure in ten months.
This year, from March to April, the number of mortgages approved increased by 7 per cent to 42,116, according to the British Bankers’ Association (BBA). In March the number of mortgages approved was 39,203. It was also the quickest increase since September 2013.
This ten-month high represented a total value of £7bn. The BBA’s report also suggested that this was a ‘turning point’ in business lending, and they highlighted a number of possible reasons.
Among the reasons given for the sudden, sharp increase (which the BBA has chiefly attributed to the election approaching), was the ending of the Stamp Duty tax for homes bought in Scotland. The government replaced it at the beginning of April with the Land and Buildings Transaction Tax.
“Borrowers are taking advantage of record-low mortgage rates and the signs are that these will continue to be competitive. When a record-breaking mortgage rate is pulled, it is soon replaced by an even lower one as lenders compete,” said Mark Harris, of SPF Private Clients.
Richard Woolhouse, of the BBA, said: “There was a significant pre-election jump in mortgage approvals which we would expect to continue in the coming months.”
However, first-time buyers should not expect the housing market to take off, according to Matthew Pointon of Capital Economics, who said: “A lack of available stock continues to dissuade buyers from entering the market.”
