High for mortgage approvals
Homebuyers get green light most times in a year since 2007 despite pandemic, writes Vicky Shaw of PA
The number of mortgage approvals made to homebuyers last year was the highest since 2007 – despite the housing market being effectively shut for part of the year as the coronavirus crisis hit.
The Bank of England said that at 818,500 in 2020, the number of mortgage approvals for house purchase surpassed levels seen in 2019 (789,100).
Last year’s figure marked the highest annual total since 2007, the Bank confirmed.
Approvals hit a record low of 9,400 in May 2020, but they picked up sharply in the second half of the year, the Bank’s Money and Credit report said.
In a sign of future mortgage lending, 103,381 approvals for house purchase were recorded in December last year, which was only slightly lower than in November 2020.
A temporary stamp duty holiday in England and Northern Ireland which has been in place since July 2020, and similar tax breaks in Wales and Scotland, are due to end soon.
Industry bodies have warned this could lead to a property transactions “cliff edge”.
Nitesh Patel, strategic economist at Yorkshire Building Society, said: “Mortgage approvals for home-movers outperformed 2019, despite activity coming to a standstill for weeks during the first lockdown.
“In many ways it was a year of two halves, with an active market prior to the lockdown, which came to a hard stop in March. When the market reopened last summer, the rapid uplift in activity took many by surprise.”