BBA reports rise in December mortgage approvals

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by Kay Mitchell

The British Bankers’ Association (BBA) has today revealed a rise in the number of new mortgages approved by the major banks in December.

According to the BBA, mortgage approvals for the month stood at 45,897 – slightly higher than the 44,965 loans approved the previous month.

Traditionally, December is a quiet month for house purchase but the rise was attributed to homeowners rushing to beat the stamp duty rise on 1 January.

The stamp duty holiday ended on 31 December 2009, consequently all properties priced at £125,000 and above are once again subject to the levy.

In the meantime, the BBA Said December’s figure was 102.2% higher than a year ago.

However, remortgaging activity remained at low levels – at 23,480 – as a result of the low interest rate environment.

On an annual basis, however, mortgage approvals were 27% lower in 2009 compared with 2008 and the lowest since the British Bankers’ Association records began gathering data in 1997.

Today’s data comes just a few days after the HM Revenue & Customs (HMRC) revealed a rise in the number of homes sold in December in the UK.

According to HMRC, 104,000 homes worth at least £40,000 or more were sold in the month – the first time in two years that the number has exceeded the 100,000 mark.

Furthermore, the number is far higher than in January 2009 when just 41,000 properties were sold. This represented the smallest amount of transactions in any month since records began in 1977.