The number of mortgages approved in August was at the highest level since before the economic crash, according to figures from the Bank of England.
A total of 62,226 mortgages were approved by lenders last month, an increase of 1,312 from July and the highest level since February 2008.
Commenting on the data, CML chief economist Bob Pannell said: “The Bank’s August data reflect the broader-based recovery in the housing market, with a £500 million pick-up in lending for house purchase to £11.3 billion. Remortgage activity was slightly weaker and dragged overall gross mortgage lending a little lower, at £16.4 billion, although underlying approvals data signal healthy house purchase and remortgage demand going forwards.”
Richard Sexton, director of e.surv chartered surveyors, commented: “House purchase lending has taken off, and that’s before Help to Buy even kicks in. It is 30 per cent higher than August last year, with banks far more willing to lend to buyers with small deposits of under 20 per cent.
“There have been 56,000 more house purchase loans so far this year than in the equivalent period last year, which represents a staggeringly quick recovery in the space of just twelve months. But there is still a long way to go. The next phase of the recovery needs to focus on easing the squeeze on living standards, which will make it easier for would-be buyers to build a deposit. At the moment, the recovery is still being driven predominantly by equity-rich buyers in the south-east. If it wants to reknit the heart and soul of the British housing market – and the economy in general – then the government needs to do more to address the cost of living and think about the regions outside the m25.
“It also needs to create an economy which encourages more house building so house price inflation can be kept under control, otherwise the next wave of first-time buyers will have their dreams of owning a home dashed.”
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