According to the latest Bank of England Money and Credit report, the number of mortgage approvals hit 70,837 in December, compared with 70,424 in November and an average of 69,462 over the previous six months . Economists had forecast a decline to 69,600, according to a Bloomberg News survey .
The total lending figure to individuals also increased by £4.4bn in December , with the effective interest rate on new secured loans remaining unchanged at 2.55%. The rate on outstanding mortgages declined 2 basis points to 2.9% .
These figures support the evidence of a buoyant housing market, with low interest rates and record employment. Although, with the government looking at measures to curb lending to buy-to-let landlords from April 2016, it is then expected that mortgage applications will diminish.
Brian Murphy, Head of Lending at Mortgage Advice Bureau, said: “Mortgage approvals reached a near two-year high in December, rounding off a successful year for borrowers. Existing homeowners were the frontrunners in this growth, with the number of re-mortgage approvals rising by more than a quarter since December 2014” .
Last week, Nationwide reported house price growth had slowed more than expected in January, and the British Bankers’ Association (BBA) reported a seven-month low on mortgage approvals, although other surveys still point to robust property price inflation .
Sales and Marketing Manager at Phoebus Software, Richard Pike, said: “Although rates are not all important for every client when it comes to re-mortgaging, the rate is usually the driver. As for the rest of the market, the rush to complete on buy-to-let or second home mortgages before the end of March is likely to push numbers up and give us further growth in the first quarter” .
. Financial Reporter. ‘BoE: Mortgage approvals rise in December’. financialreporter.co.uk
 Bloomberg. ‘UK mortgage approvals increase amid buoyant housing market’. bloomberg.com
 Reuters UK. ‘UK December mortgage approvals hit four-month high’. uk.reuters.com