Mortgage Lending Up 17% Over the Year
By |Published On: 1st December 2015|

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Mortgage Lending Up 17% Over the Year

By |Published On: 1st December 2015|

This article is an external press release originally published on the Landlord News website, which has now been migrated to the Just Landlords blog.

The amount of mortgage approvals increased to 69,630 in October, up slightly from 69,012 in September, according to the Bank of England (BoE).

October’s number is also higher than the 68,099 average recorded over the past six months.

Mortgage Lending Up 17% Over the Year

Mortgage Lending Up 17% Over the Year

The value of new mortgage approvals reached £12.2 billion. Analysts had predicted 70,000 mortgage approvals for October, but the slightly lower figure was still 17.2% up on October 2014, from 59,423.

Chief Economist at IHS Global Insight, Howard Archer, says mortgage values are rising as house prices continue to increase.

He continues: “While housing market activity has clearly picked up appreciably overall during 2015, the slight easing back in mortgage approvals for house purchases from August’s peak levels could possibly reflect housing market activity being constrained by a shortage of properties on the market.

“It is also evident that mortgage activity has been lifted in recent months by people looking to tie in attractive mortgage interest rates before interest rates start to rise.”1

The amount of remortgaging approvals dropped to 39,629, from around 41,000 in September. However, October’s figure still sits ahead of the six-month average of 38,430.

Total lending to individuals grew by £4.8 billion in October, higher than the average monthly increase of £4.1 billion for the last six months.

CEO of Marsh & Parsons, Peter Rollings, comments on the BoE’s data: “Lending has rebounded after September’s downward blip and mortgage approvals have leaped an impressive 17% year-on-year.

“All the vitals are looking strong, and remortgaging and locking into long-term deals will still very much be the name of the game for many existing homeowners awaiting potential interest rate movement in 2016.

“These figures only look at October, and George Osborne’s package of housing announcements in the Autumn Statement last week will have keyed up a new wave of first time buyers eager to get their foot in the door.

“We may also see a winter flurry of buy-to-let borrowing before April’s Stamp Duty shake-up, as landlords seek to invest before the additional charge is levied on second homes.

“The big question as we enter the New Year is whether the supply of homes will match the increasing demand that’s clearly evident in the mortgage market.”2

In a separate study, the National Association of Estate Agents (NAEA) found that house sales to first time buyers accounted for 31% of sales in October, the highest proportion since August 2009.

It also reported that inventory increased by 16% month-on-month, up from 37 properties per branch to 43. However, it said that demand fell for the fourth consecutive month.

The NAEA revealed that there was an average of nine sales per estate agent branch in October.




About the Author: Em Morley (she/they)

Em is the Content Marketing Manager for Just Landlords, with over five years of experience writing for insurance and property websites. Together with the knowledge and expertise of the Just Landlords underwriting team, Em aims to provide those in the property industry with helpful resources. When she’s not at her computer researching and writing property and insurance guides, you’ll find her exploring the British countryside, searching for geocaches.

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