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Mortgage approvals reach five-year high

Mortgage approvals reach five-year high

Category: Mortgages

Updated: 30/09/2013
First Published: 30/09/2013

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Figures released by the Bank of England show that the number of mortgage approvals rose to 62,226 in August, the highest level recorded since February 2008.

However, analysts have pointed out that lending volumes are still well below both pre-crisis levels and long-term averages, and that despite recent talk of a housing bubble any activity in the market is still relatively weak.

Samuel Tombs, UK economist for Capital Economics, said, "Although this took the level of approvals to its highest level since February 2008, they are still around 40% down on the levels seen before the financial crisis".

These figures come at a time when David Cameron has just announced that the second phase of the Help to Buy scheme would be implemented three months sooner than expected.

In light of this, David Tinsley, UK economist at BNP Paribas, believes that mortgage figures will continue to rise over the coming months. "By the end of the year approvals could comfortably be in the 70 to 75,000 range", he said.

Critics warn that heightened demand for a limited supply of properties could push prices up further.

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