British housing market starts to 'hot up' as mortgage approvals jump: BBA

[LONDON] Mortgage approvals in Britain rose in June to their highest level since March last year, according to data from the British Bankers' Association which said the housing market is hotting up again.

Britain's housing sector slowed markedly through the latter half of 2014 after tougher checks on borrowers were introduced, but there are signs it is bouncing back.

Mortgage approvals have risen in four out of the last six months, according to official data, while lenders have for the most part reported a renewed upturn in house prices.

Approvals for house purchase rose to 44,488 from 42,876 in May, up around 6 per cent compared with a year ago, the BBA said.

Net mortgage lending in value terms rose to its highest level since April last year.

"The housing market is beginning to hot up again, with a pick-up in the number of mortgage approvals for the last month," said Richard Woolhouse, chief economist at the BBA.

"Interestingly, we've also seen an increase in the number of people remortgaging, which could be down to savvy borrowers taking advantage of competitive deals on fixed-rate mortgages ahead of a possible rise in interest rates."

The BBA data are generally a good guide to trends in more comprehensive Bank of England lending figures due next Wednesday but do not include lending by mutually owned building societies, which accounts for almost a third of mortgages.

The latest BoE data showed mortgage approvals fell unexpectedly in May, countering other recent signs that activity in the housing market has picked up in recent months.

REUTERS