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Home > Mortgages > Mortgage Data

By Marc Shoffman | Published Sep 12, 2012

Mortgage market buoyed by rising employment: Halifax

The lender’s latest house price index showed mortgage approvals increased 7 per cent in July although prices fell 0.9 per cent year-on-year to £160,256 in August.

Martin Ellis, housing economist for the lender, said prices fell 0.3 per cent between July and August and were continuing to tread water, but said there could be a gradual increase due to lower inflation.

He said: “Resilient employment has probably helped support housing demand. The number of people in employment increased by 201,000 in the second quarter of 2012, the largest quarterly increase since the three months to July 2010.”

Even though inflation has been falling in recent months – notwithstanding the slight pick-up in July - weak income growth has prevented that from leading to a significant improvement in consumers’ spending power.

Mr Ellis pointed out that, according to latest figures from the Office for National Statistics, the number of jobless households across the UK has been falling, especially in the north of England.

And, if inflation falls further over the next year, he said spending power should be on a gradual upward trend. This is likely to support housing demand and, therefore, house prices.

The Nationwide house price index for August reflected a similar mood, showing a 0.7 per cent year-on-year change up to the end of August to £164,729.

It comes after data from Moneyfacts found the average two-year fixed mortgage fee is £1565 and a 75 per cent loan-to-value offers an average rate of 4.31 per cent while the five-year fixed is slightly less at £1014 and the average 75 per cent LTV will cost 4.19 per cent.

Minesh Patel, owner of London-based EA Financial Solutions, said: “Over the past two months I have seen considerable activity from first-time buyers wanting to get on the housing ladder as well as people wanting buy-to-let property. ”

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