The latest data released from the Bank of England has revealed that mortgage approvals hit a seven month high in October, rising to 67,518 from September's total of 62,932.
According to BoE, this is the highest figure seen since 69,994 in March and is above the average of 63,914 over the previous six months.
The number of approvals for remortgaging was 43,513, also above the six-month average of 42,115. Lending secured on dwellings increased by £3.3 billion in October, compared to an average monthly increase of £2.6 billion over the previous six months.
Gross lending secured on dwellings was £19.9 billion and repayments were £17.2 billion.
Matt Andrews, Managing Director, Bluestone Mortgages, had this to say: “The fact that the Autumn Statement has promised a £1.4 billion investment into house building is likely to support the rise in purchase and lending activity even further, as this may finally help to address the persistent lack of UK housing supply.
However, whilst this market continues to expand, there are still many borrowers who remain underserviced by mainstream lenders. Contractors, the self-employed, those with adverse credit histories are still being automatically rejected for credit because they don’t fit rigid lending criteria.
The UK workforce is changing, however, with the number of self-employed workers jumping up by 45% since 2000. Borrowers like these need a personalised underwriting experience that can understand the reasons behind their particular circumstances. Brokers have a critical role to play in this regard, as their specialist experience will enable them to find the best and most suitable solutions for their clients, based on an holistic view of their financial situation.”
Jeremy Duncombe, Director of Legal & General Mortgage Club, commented: “With the usual increase in buyer activity that comes with the autumn months, it is not surprising to see these figures show a continuing rise in the number of mortgage approvals in October. However, what these figures also show is an ongoing rise in the number of buyers choosing to swap their existing mortgage deal, undoubtedly to take advantage of lower rates following the Bank of England’s lowering of the base rate in August."
Jeremy Leaf, former RICS residential chairman, added: "These numbers are encouraging as they show considerable resilience in the market, demonstrating again that the short-term fears about Brexit were overestimated and the long-term implications may have been underestimated. Needless to say, the real test of the market will come in early 2017 when we will see whether or not these approvals have been translated into increases in sales.
The figures are particularly welcome as at this time of year people have other things on their mind and we expect a slowdown in the run up to Christmas. We wait with anticipation as to how people will respond in the new year. However, even with the festive season almost upon us there is still a determination among many to get on with buying and selling at realistic price levels."
Mark Dyason, director of independent mortgage broker, Edinburgh Mortgage Advice, commented: "The strong October mortgage approvals data for house purchases underlines how Brexit has actually spurred people into action rather than driven them away from property. People are aware that rates have never been better and at the same time are uncertain about what's coming next politically.
As a result, they're moving now rather than risk getting their plans skewered by some other major development in 2017. Brexit has created uncertainty but increasingly that uncertainty is causing people to act rather than do nothing. Uncertainty is emboldening buyers to take action.
Prices in many areas, and certainly the south of England, are a lot more attractive than they were a year or so ago. In many cases it's a buyer's market and they are increasingly taking advantage of this fact. Better prices and the best mortgage rates you could imagine in a political environment that could change very quickly is causing people to act."