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Mortgage approvals for house purchase hit 13-year high

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The Stamp Duty holiday has acted as a catalyst for buyers who want to complete their purchase before the March 2021 deadline
Mortgage approvals for house purchase hit 13-year high

The number of mortgages approved for house purchase rose in October to 97,500, up from 92,100 in September, according to the Bank of England.

It noted that this was the highest number of approvals since September 2007, 33% higher than February 2020 and 10 times higher than the trough of 9,400 approvals in May.

Remortgage approvals were unchanged in October, at 32,900, and remain around 40% lower than in February 2020.

The Bank said that the mortgage market remained strong in October with additional borrowing of £4.3bn secured on homes, slightly down on September’s £4.9 billion, but hugely up on April’s £0.2bn.

Andrew Montlake, managing director at mortgage broker, Coreco, said: “Brokers have been busier than ever since the property market reopened in May of this year and the number of approvals in October reflects the mad stampede to buy before the stamp duty holiday ends.

“This data is bittersweet, of course, as we all know that 2021 could see the real economic impact of the pandemic start to bite. It’s hard to celebrate such robust mortgage approvals data when we all know what’s round the corner.

“What’s vital is that lenders don’t become overly cautious and stop lending to borrowers with larger deposits. With a vaccine looming, lenders will hopefully avoid entering panic mode.

“There are still many landlords and owner-occupiers with equity and decent incomes, who are perfectly viable borrowers, and the banks shouldn’t forget this.”

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