UK Mortgage Approvals Hit 21-Months High

According to the latest figures released by the British Bankers’ Association on Tuesday, November 24th, the number of approved mortgages in the UK in October increased almost by 100%, compared to the same month last year.
The figures suggest that the number of approved residential mortgages grew by 97.7% in October 2009, and reached 42,238 – the highest level in 21 months. As for month-on-month changes, mortgage approvals in October grew by 4% compared to September 2009, when the figure stood at 42,073. Overall mortgage lending in October remained unchanged from its level in September, and amounted to £3.1 billion.
Despite the fact that the figures of the British Bankers’ Association found proof in a number of other surveys suggesting that low mortgage rates helped boost the UK housing market, many experts of the property sector remain uncertain over the recovery of the housing market.
As such, Mr. Archer, IHS Global Insight economist, is determined that the month-on-month increase in mortgage approvals between September and October is insignificant, which means that the recovery of the UK housing market is slowing down. He added that other factors, such as the growing rate of unemployment, slow growth of household income, and falling house prices clearly indicate that negative changes on the British property market are under way.
In the opinion of Mr. Archer, the supply and demand balance, which has leaned towards sellers in the past months, will soon move away from them towards buyers as a result of increased house prices and growing number of marketed properties.
The report of the British Bankers’ Association showed that the total value of all approved mortgages in October rose to £9.3 billion in October, compared to £9.2 billion in September; however, the figure is 20% lower than at the same time last year.