30/03/2009

Mortgage Approvals Rise By 19%

The number of mortgages approved for house purchases in Britain has jumped by 19% in February, figures have revealed.

Bank of England figures showed there were 38,000 approvals last month, up from 32,000 in January.

It suggests that record low interest rates and the recent decline in house prices have begun to entice buyers back to the property market.

Vicky Redwood, UK economist at Capital Economics, said: "February's household borrowing figures suggest that housing market activity may finally have turned a corner.

"The rise in the number of mortgage approvals for new house purchase... might suggest that the pick-up in new buyer inquiries is feeding through into actual activity. With new buyer inquiries still rising, this is clearly quite promising."

Last week the British Bankers' Association released figures showing the number of mortgages approved for house purchase by the major banks rose for the third month in a row during February.

However, it is thought much of that increase was driven by banks' greater market share, as opposed to higher overall lending levels.

These latest figures have beaten economists' expectations and are well up on the recent six month average of 31,495. This suggests sales may be picking up again.

(JM/BMcC)

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