Mortgage approvals in August were up 32% year-on-year at £9.3bn according to the latest figures from the British Bankers’ Association.
The seasonally adjusted figures show approvals rose 2% from July’s £9.1bn and were up 32% on August 2012’s £7bn. The monthly tally also marks a four-year high for approvals – the last time there were more approvals was in January 2009 at £9.4bn. The average value of loans for house purchase dipped slightly from £158,000 in July to £156,000.
Year-on-year the number of loans for house purchase has risen by 20% from 30,000 in August 2012 to 38,000 in August 2013. Remortgage volumes have also risen over the same period from 17,000 last year to 22,665 in August 2013. BBA statistics director David Dooks says the figures suggest that consumer confidence is growing.
He says: “For the first time in four years, annual growth in household borrowing on credit cards and personal loans has turned positive and mortgages approved for house purchase are also at their highest level since 2009.
“Business borrowing, influenced by large corporates using alternative market funding, again contracted, but within that, SME borrowing is stable.”
LSL Property Services commercial director David Brown says: “Mortgage approvals are still a long way from their peak, and more importantly a long way from the levels that could make everyone a homeowner. This is excellent progress, but the mortgage industry has only conquered the foothills of a real recovery.
“Solvent banks, solid balance sheets, and economic growth are one thing. Beyond these foundations of the industry, sustainable growth for mortgage lending will depend on people earning more, and eventually saving more. So while the next few years could prove better times for some first time buyers, the number who live in privately rented accommodation is set to keep growing.”