Recently issued figures have shown that the number of mortgages approved by banks for house purchases has doubled in December 2009, when compared to the same month in 2008.
1 January saw the end of stamp duty holiday for properties which were worth up to £175,000. According to what the British Bankers’ Association (BBA) told the London Evening Standard, this led to a slight rise in mortgage applications agreed during the month. The association said 45,897 house-purchase loans ‒ which were worth £10.2 billion ‒ were approved in December, which means this is 1,000 more than November’s recordings and up 102.2 per cent from a year ago.
Last year overall, mortgage approvals were down by 27 per cent than 2008, which is the lowest since 1997, when the BBA began reporting the figures. The BBA’s David Dooks informed the Evening Standard that major British banks, who belong to the BBA as its members, had managed to get a bigger slice of the market during the recession thanks to specialist lenders withdrawing and building societies lending less.
Mr Dooks commented on house-purchase loans: “The high street banks continued to lend substantial amounts in the weaker mortgage market of 2009, approving more than 440,000 loans for house purchase. Their share went up from a historical level of about two thirds to three quarters.”
However, Howard Archer at IHS Global Insight warned: “While housing-market activity was clearly lifted through 2009, the upside continues to be limited by unfavourable economic fundamentals. Unemployment is high and likely to rise further in 2010 and earnings growth is low.”
