Bank of England figures show that compared to a year earlier, mortgage approvals are 48.8 per cent higher, and 62.7 per cent above the low point reached in November 2004. Mortgage approvals are also above their average for the last decade of 100,000,
The Royal Institution of Chartered Surveyors (RICS) believes the latest data strengthens the argument that the housing market in 2006 will see the first rise in activity since 2002, after three consecutive years of decline.
RICS expects mortgage approvals to hit 1.33 million in 2006 compared to a total of 1.2 million for 2005, but still below the 2002 level of 1.42 million.
The levelling out in the number of mortgage approvals ended a 13-month run of consecutive increases which started in November 2004.
RICS believes that the impetus from August’s interest rate cut is fading, making further increases in activity unlikely, but the firm economic climate means that housing demand will stay steady.
Housing market affordability remains difficult for first-time buyers. However, the RICS residential survey for January showed a renewed surge in buy-to-let investor demand which has hit a two-year high. This is giving support to relatively high price levels.
