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Mortgage Approvals Reach 8 Year High

Mortgage borrowing has hit the highest level since 2008, with an estimated £245.7bn borrowed in the year of 2016, according to a new study.

Property market UK

Mortgage borrowing has hit the highest level since 2008, with an estimated £245.7bn borrowed in the year of 2016, according to a new study.

Compiled by the Council of Mortgage Lenders (CML), the research revealed that despite uncertainties on the market following the stamp duty changes and the Brexit vote – the estimated total amount homeowners who borrowed last year was 12% higher than in 2015.


With a year-on-year increase of 4%, December indicated a strong finish to the year, recording a total mortgage value of £20.4bn.


Despite the strong finish, December’s figures indicated a month-on-month fall of 4% from the £21.2bn recorded in November.


The strong growth of mortgage values is partly driven by the sharp increase of house prices since the financial downturn, said the group. While the 2016 figures are close to the £247.8bn recorded in 2008, the number of mortgages approved last year was well below the level recorded 8 years earlier.


Statistics from the Bank of England indicated that the projected 1.45m loans approved in 2016 was 21% below the 1.84m approved in the year of 2008 – however the value of last year’s mortgages were on average higher.


Commenting on the result, the senior economist at CML, Mohammad Jamei, said:


‘Approvals for house purchase have recovered strongly of late, and this should feed through to lending figures in the early months of 2017. The current availability of mortgage credit is benign, and the real issue continues to be a dearth of properties on the market, which adds to the challenges facing would-be buyers.’


Last week, Lloyds Bank revealed that homemover levels have fallen to the lowest level since 2011, following the rise in house prices.

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