Mortgage approvals from Banks rose slightly in October compared to September, but they were down 10% over the last 12 months, according to figures from the British Bankers’ Association.

In October, 40,851 mortgages were approved for house purchases, compared to 38,690 in September and 45,352 during the same period in 2015.

Gross lending dipped 4% to reach £12.5bn in October, as remortgage activity outperformed purchasing.

Dr Rebecca Harding, BBA chief economist, said: “Mortgage approvals ticked up a little October.  There has only been a relatively modest increase in activity since the Bank of England cut rates in August.”

Andy Knee, chief executive of conveyancing service provider LMS, added: “The EU referendum and resulting record-low rates are driving families to capitalise and reduce their monthly mortgage bills.

“With a potential rate rise in 2017, something that 23% of remortgagors have told LMS they expect, it is comforting to see homeowners taking stock and striving to improve on their current mortgage deals.”

Remortgage boost

Year-on-year, the value of remortgage lending by banks in October rose by 4% to £4.5bn while house purchasing saw a decline of 6% from £8bn to £7.6bn.

Remortgage approvals remained fairly static last month, compared to the previous year, at 24,622; just 63 approvals higher than October 2015.

Knee added: “In general, the UK housing market is well positioned for the challenges that 2017 poses. The latest figures from the Department for Communities and Local Government show a spike in new-build dwelling starts and completions for England in the third quarter of this year, in comparison to the second quarter.

“The Chancellor’s announcement of a Housing Infrastructure Fund worth £2.3bn in yesterday’s Autumn Statement is a sign of the government’s intent to tackle the housing supply issue, crucial for market stability, which will make the UK property market more favourable for first-time buyers and remortgagors alike.”