Mortgage approvals jumped by 51 percent in November: BBA |
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Thu, 29 Dec 2005 19:25
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LONDON - Mortgage approvals for buying homes jumped by 51 per cent on a yearly basis in November, according to the latest figures released by the British Bankers’ Association. This data firmly reinstates the belief that the housing market has emerged out of the rut and is slowly, but surely moving up.
Mortgage approvals in November totaled 71,310 as against the 72,328 in October. These figures are of loans approved, but not yet paid out. Although the November figure was marginally less than that of October, it was still 51 percent more than the approvals at the same time last year.
"Approvals, particularly for house purchase, continued to be strong with little evidence of the normal seasonal slowdown,” said David Dooks, the BBA's director of statistics. "Gross lending on mortgages reached a very high level in November confirming the recovery in the housing market after a relatively weaker early part of the year." The net mortgage lending for the month of November was recorded to be £5.1 billion as compared to the £4.3 billion in October. This was again the biggest increase since July last year and bodes well for the future.
Analysts say that the November data reinforces the belief that the August rate cut by the Bank of England helped the housing market. "Activity is benefiting from August's interest rate cut, increasing confidence in the housing market and still rising employment,” said Howard Archer, chief UK economist at Global Insight.
"This is likely to put a floor under house prices." But this did not mean that the house prices would rise rapidly in the near future, "We remain highly doubtful that house prices will move substantially higher on a sustained basis any time soon," Archer said. "If house prices start to accelerate markedly, we believe buyer interest will soon diminish, thereby keeping a lid on prices."
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House price inflation at its slowest in 9 years 