Mortgage approvals reach to highest level since 2007

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The number of mortgage approvals in November 2020 increased to the highest level since August 2007, according to the Bank of England Money & Credit data. The number of mortgage approvals reached 105,000 in November, with net mortgage borrowing also increasing to £5.7bn. In addition, effective interest rates on new mortgage borrowing ticked up to 1.83%. Household deposits increased by £17.6bn in November, however there were significant withdrawals from national savings and investment accounts according to the data. Bank borrowing by small and medium-sized businesses was noted at £1.8bn, while net borrowing by large businesses was £0.2bn.

Jeremy Leaf, north London estate agent and a former RICS residential chairman, added: “Not surprisingly, the mortgage market improved considerably at the end of the year but we shouldn’t look too closely at these figures because they reflect a period of particular improvement in market activity of the previous few months. Moves have slowed since although many are still trying hard to take advantage of the stamp duty holiday, which will be ending very soon. The likelihood of further lockdown restrictions will bring short-term pain to the market which hopefully won’t be reflected in reduced values. Certainly the greater availability of a vaccine, on the other hand, will provide some optimism.”