Posts with tag: mortgage approvals

Mortgage Lending Up £3.4bn in One Month

Published On: September 30, 2015 at 3:58 pm

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Mortgage lending has risen by the greatest level since 2008, according to official data from the Bank of England (BoE).

Mortgage Lending Up £3.4bn in One Month

Mortgage Lending Up £3.4bn in One Month

In August, 71,030 loans were approved for home purchases – the highest monthly figure for 19 months and up by 20% on levels recorded as recently as November 2014.

The Bank announced that total net mortgage lending grew by £3.4 billion in August, compared with the £2.8 billion rise in July – the highest number since May 2008.

The report arrives after the Land Registry revealed that the average house price in England and Wales increased by 0.5% in August to £184,682.

And the rise in mortgage lending follows a price war between lenders, causing rates to drop to record lows. Homebuyers are also rushing to secure competitive mortgage rates before interest rates start rising.

Chief Executive of the Royal Bank of Scotland (RBS), Ross McEwan, says customers are moving from standard variable rates (SVRs) “because they are frightened of interest rates going up”1.

Most consumers are moving onto two or five-year fixed rates, with SVR mortgages accounting for 18% of the bank’s mortgage lending, compared with 25% a year ago.

UK Economist at IHS Global Insight, Howard Archer, says the latest data provides “more compelling evidence that housing market activity is on the up”. He adds: “Stronger buy-to-let activity is also pushing up mortgage approvals.”

Archer now expects house prices to end the year 7% higher than at the start, and to rise by a further 6% in 2016. He explains why: “Higher interest rates are unlikely to have a major dampening impact on housing activity for some time to come, as the BoE is stressing that interest rates will only rise gradually and to a limited extent.”1

Head of Lending at the Mortgage Advice Bureau (MAB), Brian Murphy, believes there are “no signs of a summer slowdown” in the mortgage market.

He concludes: “The remortgage market in particular has experienced a burst of activity, with approvals for remortgage rising more than twice as fast as those for house purchase year-on-year.”1

1 http://www.theguardian.com/money/2015/sep/29/mortgage-lending-hits-19-month-high

 

 

 

 

Mortgage Approvals at 17-Month High in July

Published On: September 1, 2015 at 5:20 pm

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The amount of mortgage approvals increased to 68,764 in July, the highest number since February 2014, says the Bank of England (BoE).

Mortgage Approvals at 17-Month High in July

Mortgage Approvals at 17-Month High in July

July’s approvals level surpassed June’s 66,582 and the average of 64,186 for the previous six months, according to the latest BoE Money and Credit report.

The number of approvals for remortgaging also rose, hitting 38,042 in July compared with 36,620 in June and an average of 33,759 for the previous six months.

Furthermore, the report indicates that net mortgage lending grew by £2.7 billion in July, higher than June’s £2.6 billion and the largest increase since July 2008.

Head of Lending at the Mortgage Advice Bureau (MAB), Brian Murphy, states: “Mortgage approvals continued to climb in July, with the number of approvals for remortgage in particular seeing a significant annual increase. Bargain basement mortgage rates are attracting borrowers in their droves and many are keen to lock into record low pricing before interest rates rise.

“Not only do remortgagers stand to make significant savings by switching to a competitive deal, many are in a strong position to cash in on the rising value of their home. Our own analysis shows that the average remortgage loan has reached a new post-recession high, with typical loan-to-values [LTVs] also increasing. Savvy borrowers are therefore increasingly making the most of house price rises by releasing money from their homes.

“The second half of the year is often a good time to look for a mortgage; lenders falling behind their annual targets will beef up their product offering to attract new business. This year, it may also be the last window of opportunity to get hold of a record low rate. Several lenders have edged up their pricing recently and it won’t be too long before rates reach the bottom of the curve.”1

1 http://www.financialreporter.co.uk/mortgages/boe-july-approvals-at-17-month-high.html?utm_content=buffer9f5c2&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer

High Street Bank Mortgage Approvals Rise

High Street Bank Mortgage Approvals Rise

High Street Bank Mortgage Approvals Rise

Mortgage approvals by high street banks for residential property purchases increased by 11% annually in July.

The British Bankers’ Association (BBA) reports that there were 46,033 approvals for house purchase loans.

There was also a 29% annual rise in remortgage approvals, to 24,400, according to the BBA. This is the highest number for four years, as borrowers rush to switch to new deals ahead of the imminent interest rate increase.

Both figures were up on June’s numbers, with overall approvals at 77,451 in July, from 76,104.

Additionally, the UK mortgage market has been given a boost by the Chinese financial crisis.

Chief Economist at the BBA, Richard Woolhouse, comments: “In July, people were concerned about an interest rate rise and I think this led to a rush in remortgaging.

“Everything that has happened in China this week puts the likelihood of that rise back two to three months.

“But even if rates do go up in the near future, I don’t think mortgage rates will go up as much and in any case, this won’t impact much on people’s decision to buy a house.”1

1 http://www.propertyindustryeye.com/mortgage-approvals-by-high-street-banks-jump-up/

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

e.surv Estimates Drop in Mortgage Approvals for July

Published On: August 18, 2015 at 3:59 pm

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Categories: Landlord News

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Chartered surveyors e.surv has estimated there was a monthly drop in mortgage approvals in July, ahead of the release of official data.

According to its own calculations, e.surv expects there to have been 1.8% fewer mortgage approvals in July than in June, reversing the upward trend that has been experienced for the past eight months.

e.surv Estimates Drop in Mortgage Approvals for July

e.surv Estimates Drop in Mortgage Approvals for July

e.surv believes there were 65,356 house purchase mortgage approvals in July, down from 66,582 in June.

Director of e.surv, Richard Sexton, says: “The Bank of England [BoE] has been beating the drum over a base rate rise that has yet to appear.

“Their hawkish rhetoric has had a knock-on effect on the mortgage market, with some banks beginning to withdraw their lowest interest mortgage deals.

“In turn, this appears to have dampened demand for house purchase lending in the short-term, whilst stimulating remortgage activity.

“The mortgage market should be resilient in the face of this threat. Reforms like MMR [Mortgage Market Review] introduced since the recession have left us with a market built to ride out storms.

“Any increase to the base rate is likely to be slow and steady. The BoE has as much reason as anyone to be careful about rocking the boat.

“With incomes rising and inflation staying low, many borrowers have been making hay while the sun shines and paying down their mortgages, while others have been taking the very sensible decision to lock into low rates.”1 

e.surv’s figures also suggest there was a decline in the amount of borrowers with small deposits in July – those with a deposit of 15% or less of the property’s value. It says that on average, 16% of all approved UK loans were for those with small deposits, compared to 17% in June. The biggest decreases are thought to have been in the East of England and Scotland.

The BoE’s Mortgage Lenders and Administration quarterly statistics report is due in September.

1 http://www.propertyindustryeye.com/e-surv-predicts-july-mortgage-approval-drop/

 

Mortgage approvals drop in July

Published On: August 18, 2015 at 2:42 pm

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Categories: Landlord News

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The total number of mortgage approvals for house purchase dropped in July, representing the first fall in eight months.

Data from the latest Mortgage Monitor from e.surv shows that mortgage approvals dipped by 1.8% in July to 65,356, from the 66,582 recorded in June.[1]

Slip

There was also a fall on an annual basis, with 0.2% fewer mortgage approvals from the 65,517 registered in July 2014. This represented the first year-on-year decline since March of 2015.[1]

Falls in approvals come as a member of the Bank of England’s Monetary Policy Committee voted to increase the base rate from its current record low of 0.5%. Wider warnings of an increase at the beginning of next year continuing to gather pace.

Richard Sexton, director of e.surv chartered surveyors, said that,’ the Bank of England has been beating the drum over a base rate rise that has yet to appear. Their hawkish rhetoric has had a knock-on effect on the mortgage market, with some banks beginning to withdraw their lowest-interest mortgage deals. In turn, this appears to have dampened demand for house purchase lending in the short-term, whilst stimulating remortgage activity.’[1]

‘However, the mortgage market should be resilient in the face of this threat,’ Sexton continued, before claiming that ‘reforms like MMR introduced since the recession have left us with a market built to ride out storms.’ He feels that, ‘any increase to the base rate is likely to be slow and steady. The Bank of England have as much reason as anyone to be careful about rocking the boat. With incomes rising and inflation staying low, many borrowers have been making hay while the sun shines and paying down their mortgages, while others have been taking the very sensible decision to lock into low rates.’[1]

Sexton believes that, ‘for now, it’s a waiting game-but it is reassuring to see that this level of uncertainty has had a limited impact on the number of approvals. What we see here are banked coals, not fading embers.’[1]

Small-deposits

July also saw a dip in the number of small-deposit borrowers. In total, there were 10,588 small-deposit house purchase loan approvals in July, down by 5.9% on the 11,252 in June and a 7.1% annual drop from the 11,400 recorded in July 2014.[1]

What’s more, small-deposit borrowers accounted for 16.2% of all house purchase approvals in the last month, a fall from 16.9% in June and from 17.4% one year ago. Regionally, lending borrowers with a lesser deposit fell by a larger amount in the East of England and Scotland.[1]

Mortgage approvals drop in July

Mortgage approvals drop in July

In the East of England, a rise in property prices has seen many buyers with smaller deposits alienated, with the proportion of small-deposit lending in the region falling to 14% of all house purchase mortgage approvals. North of the border, just 9% of all Scottish house purchase mortgages approved in July went to borrowers with a low deposit, down from 11% in June.[1]

Vulnerable

Mr Sexton explained that, ‘smaller-deposit borrowers-typically first-time buyers, tend to be more vulnerable to change than other mortgage holders. Consequently, we have seen some slowdown in this sector. But they still remain a significant proportion of the total house purchase mortgage market, even with some understandable nervousness over the prospect of a rate rise.’[1]

‘Though some of the ‘ultra-low’ fixed rate repayment plans are being reeled in, there is still a wide range of cheap deals on offer. Stiff competition between lenders has broken a lot of new ground in terms of low rates. We shouldn’t be overly concerned by the very cheapest offers being reined in – there is still a wealth of deals and schemes that are helping borrowers with small deposits get onto the property ladder. The real heart of the issue has always been a shortage of supply. This tension at the bottom of the market will persist until more homes are built and made available to first-time buyers,’ Sexton continued.[1]

Concluding, Sexton said, ‘The falling proportion of lending to borrowers with smaller deposits in the East of England shows that borrowers across the country need support. Property price inflation has started to nip at the heels of smaller-deposit lending in the East, further emphasising the importance of the Help to Buy scheme, which is helping many borrowers put together enough of a deposit to get on the housing ladder, even as prices climb.’[1]

[1] http://www.propertyreporter.co.uk/property/mortgage-approvals-slip-in-july.html

 

 

Increase in Mortgage Approvals

Published On: July 30, 2015 at 9:49 am

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Increase in Mortgage Approvals

Increase in Mortgage Approvals

The Bank of England (BoE) has revealed that there were 66,582 mortgage approvals in June.

This is higher than the average of 62,971 for the previous six months, but less than April’s total of 68,051.

There was also a significant rise in remortgage approvals in June, at 36,620 from the average of 33,759 for the six months beforehand.