Mortgage approvals hit four-year high

Gross mortgage borrowing of £9.3bn in August was slightly more than July’s figure of £9.2bn and was above the six-month average of £8.4bn, data from the British Bankers’ Association revealed.

The numbers of approvals for house purchase and remortgaging both rose in August, with house purchase at the greatest level since 2009 and remortgaging the highest since 2011.

Assistance schemes for mortgage borrowing are also helping more first-time buyers and housing chains generally as housing market activity continues to increase.

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Approvals in August for borrowing other than house purchase or remortgaging were in line with those seen during the rest of the year.

There was a fall in total business borrowing levels in August and annual growth continued to contract.

David Dooks, statistics director of BBA, said: “These figures suggest that consumer confidence is growing.

“For the first time in four years, annual growth in household borrowing on credit cards and personal loans has turned positive and mortgages approved for house purchase are also at their highest level since 2009.

“Business borrowing, influenced by large corporates using alternative market funding, again contracted, but within that, SME borrowing is stable.”

Mark Harris, chief executive of mortgage broker SPF Private Clients, said: “Consumer confidence continues to grow, with more buyers committing to new mortgages.

“Lower rates and easing criteria are proving attractive, while government-assisted schemes such as Help to Buy are propelling more first-time buyers onto the housing ladder.

“Despite talk of a housing bubble, the reality is that we are some way off a sustained recovery, with transactions at far lower levels than at the height of the boom years.

“However, mortgage brokers and estate agents are reporting high levels of enquiries in September so we expect these to be reflected in improved official figures in coming months.”