Mortgage approvals at 13-year high

Around 105,000 home loans for house purchase got the go-ahead, up from 98,300 in October and marking the highest number since August 2007.

The surge in approvals meant that by November 2020, they had nearly caught up with levels recorded in 2019 – despite the housing market effectively being shut earlier on in 2020 due to coronavirus measures.

There were 715,300 house purchase approvals up to November 2020, compared with 722,000 during the same period in 2019, the Bank said.

Mark Harris, chief executive of mortgage broker SPF Private Clients, said home buyers have been motivated by a current stamp duty holiday, which ends on March 31, as well as the desire to move to a different location.

He said: “We expect mortgage rates to remain competitive into the spring as borrowers attempt to take advantage of the stamp duty concession.” Andrew Montlake, managing director at mortgage broker Coreco, said: “The closing stages of 2020 were among the busiest we’ve ever been as a broker.

“That looks set to continue in the first quarter, too, ahead of the looming stamp duty deadline.

“Many prospective buyers with small deposits are now fully aware that their chances of getting a mortgage agreed are remote.”

Looking at non-mortgage borrowing, the Bank said consumer credit contracted by 6.7% annually in November – marking a new low since records started in 1994.

Consumer credit includes borrowing using credit cards, personal loans and overdrafts.

Borrowing using credit cards fell by 14.5% annually – which was also a new low on the Bank’s records.

The Treasury-backed body previously said the reductions would mean it aligned its savings products against the rates offered by the banks and building societies.

Thanks for reading. If you value what we do and are able to support us, a digital subscription is just £1 for your first month. Try us today by clicking here and viewing our offers ...