BBA: Mortgage approvals sees slight rise in January

Permalink: BBA: Mortgage approvals sees slight rise in January
by Kay Mitchell

Figures released today by the British Bankers’ Association (BBA) have revealed a slight rise in January mortgage approvals.

According to the BBA, a total of 23,376 mortgages were approved in January – the highest level for four months and up from the 22,416 approved in December.

However, the figure is still 43% lower when compared with January 2008.

Net lending, which strips out redemptions and repayments, fell to £2.9 billion in January, down from £3.3 billion in December – almost half the level seen in January 2008.

The BBA said January’s approval activity, both in volume and value, was slightly higher than December, but continues to be at a very low level.

However, David Dooks of the BBA was positive about the latest figures and said “The High Street banks’ mortgage lending is still seeing double-digit annual growth, albeit in a much slower market.”

Meanwhile, remortgaging saw a marginal improvement with the figure at 30,710 for January, a slight rise from the 30,500 in December.

A recent survey from the Intermediary Mortgage Lenders Association revealed that 58% of first-time buyers are locked out of the market since only those with a hefty deposit are able to get a foot onto the property ladder.

The average deposit now required is 22% – the highest in 34 years – suggesting that the reason behind the continued fall in mortgage approvals is the lack of mortgage funding for those without a deposit.

However, it was revealed yesterday that Government-owned Northern Rock is set to return to the mortgage market offering loans of up to 90% of a property’s value.