Future Retirement Success
  • Politics
  • Business
  • Investing
  • Stocks
  • Politics
  • Business
  • Investing
  • Stocks

Future Retirement Success

Business

Mortgage approvals rise for first time in six months

by March 30, 2023
March 30, 2023
Mortgage approvals rise for first time in six months

Mortgage approvals rose for the first time since August in a sign that the “worst is in the past”, Bank of England figures show.

The number of mortgages approved for house purchases beat economists’ expectations to reach 43,500 in February, up from 39,600 in January.

However, the level of mortgage borrowing remained about 35 per cent lower than pre-pandemic levels as the rising cost of borrowing coupled with the cost of living crisis fed into caution among consumers.

Despite the rise in approvals, overall mortgage lending fell from £2 billion in January to £700 million last month which, outside of the pandemic period, marks the lowest level of net borrowing since April 2016.

A tenth interest rate rise in just over a year to 4 per cent in February also pushed up the effective interest rate, which is the actual rate of interest paid, on newly drawn mortgages to 4.24 per cent, up by 0.36 percentage points compared with the start of the year. Interest rates have since risen further to 4.25 per cent as the Bank of England tackles double-digit inflation.

Martin Beck, chief economic adviser to the EY Item Club, said: “The latest household lending data indicated continued weakness in housing market activity, albeit with signs that the worst may be in the past.”

The latest figures reflect the period before the global financial volatility caused by the collapse of Silicon Valley Bank and the run-up to UBS’s takeover of Credit Suisse.

“The unknown is the extent to which banks respond to that volatility by tightening lending standards,” Beck said. “The optimistic view is that the capital and liquidity strength of UK banks mean there’s little effect, and lending to households can carry on as before. But in the pessimistic case, should lending standards tighten, it could mean further weakness in the housing market and a reduction in consumers’ ability to use debt to compensate for falling real incomes.”

Samuel Tombs, chief UK economist at the Pantheon Macroeconomics consultancy, said the economy was being supported by households eating into the “excess” savings they made over the pandemic, but these households will seek to rebuild the buffer when their incomes recover.

House prices across the UK held up better than many experts had expected, with the latest data suggesting that, after wobbling at the end of last year, they have stabilised so far in 2023.

The average price of a home in the UK was £285,476 in February, according to Halifax’s house price index — 2.1 per cent higher than this time last year. The annual rate of house price inflation has held steady for three months in a row.

The data also showed that net lending for commercial property turned negative in February, falling to minus £288 million, as investors held back out of concern about falling capital values.

Matthew Pointon, senior property economist at the Capital Economics consultancy, said: “The decline was small and even though the recent banking crisis will lead to some tightening of credit conditions, with the ratio of UK bank commercial property debt to capital values still low by past standards the risk of commercial property triggering a banking crisis here is low.”

Read more:
Mortgage approvals rise for first time in six months

0
FacebookTwitterGoogle +Pinterest
previous post
Nashville school shooting: Republican congressmen demand AG Garland launch hate crime investigation
next post
We must not forget the lessons of our financial crisis, warns Jeremy Hunt

You may also like

NatWest chairman must be replaced over ‘whitewash’ review,...

July 30, 2023

Get Ahead of the Curve: What Business Insurance...

December 28, 2022

Google faces £5bn UK lawsuit over claims it...

April 16, 2025

HS2 boss admits London to Birmingham line could...

January 11, 2024

The Top 7 Ways to Travel Europe on...

July 29, 2022

Jaguar land rover sees profits dip by 17%...

January 29, 2025

Deliveroo launches over 50s awareness campaign to help...

August 3, 2023

Bitcoin surges past $80,000 as Trump nears control...

November 11, 2024

Number of firms fined for deliberate corporation tax...

August 22, 2022

UK mortgage holders will see payments rise to...

May 24, 2023

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free

    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Elon Musk may speak to Trump aides in push to calm feud

      June 6, 2025
    • Everyone Talks About Leaving a Better Planet for Our Children: Why Don’t We Leave Better Children for Our Planet?

      June 6, 2025
    • MARK HALPERIN: Democrats try to construct a Frankenstein candidate while JD Vance gains momentum for 2028

      June 6, 2025
    • ‘Gone too far’: GOP lawmakers rally around Trump after Musk raises Epstein allegations

      June 6, 2025
    • Democrats begin to embrace Musk amid Trump spat after party railed against him as a ‘dictator’

      June 6, 2025
    • Trump administration defends US and Israeli sovereignty with new sanctions against four ICC judges

      June 5, 2025

    Categories

    • Business (8,149)
    • Investing (2,011)
    • Politics (15,544)
    • Stocks (3,130)
    • About us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: futureretirementsuccess.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 futureretirementsuccess.com | All Rights Reserved