The BoE’s Money and Credit report, published today (May 31), showed the number of mortgage approvals for house purchase rose to about 66,300 in April — up slightly from the 62,559 measured for March.
Mortgage approvals show how many new loans banks have approved and that could be drawn, so capture the early stages of taking out secured lending against a property.
Therefore, they are a key indicator of current market activity and potential future lending.
However the number of approvals for remortgaging was broadly unchanged at around 49,400.
This is a turn in the market, as data released by UK Finance last month showed the number of people getting approved to remortgage increased by 11.1 per cent year-on-year in March and the number of people opting to remortgage is expected to reach a peak later this year.
The bank’s data also showed net mortgage borrowing remained strong for the second month in a row, totalling £4.3bn in April compared with the six-month average of £3.8bn.
The findings showed the annual growth rate of mortgage lending remained unchanged at 3.3 per cent, consistent with the level the market has seen since August last year.
Andrew Montlake, director of mortgage broker, Coreco, said: "Today’s buyer is spoilt rotten. Mortgage rates are obscenely low and, in the majority of cases, buyers are calling all the shots."
Mr Montlake added that while the passing of the March Brexit deadline will have spurred some into action in April, a broader Brexit apathy was becoming stronger by the day.
He said: "April was the month when activity levels for brokers started to pick up and this was confirmed in the Bank’s latest data.
"People are increasingly of the view that, even if prices fall in the short-term following a potential no-deal Brexit, in the medium-term they will reap the benefits."
He went on to say that while remortgages had been driving activity for some time, there had been a definitive pick-up in purchases over the past two months.
Richard Pike, marketing director at lending software firm Phoebus, agreed that remortgaging had played a big part in holding up the mortgage market over the past couple of years but said today’s figures showed it was levelling out.
He said: "The trend of people taking advantage of the stamp duty relief to move their current deals will have come to an end and we could see another uptick in the remortgaging figures next month.
"With household debt rising consistently, remortgaging to a better, less expensive deal is one quick way to reduce household spend and even consolidate some debt.
"The number of approvals for house purchase increased, which is a good sign for the whole market. As lenders offer better and better rates and deals, it is a good time for people to move up, or down, the ladder."
imogen.tew@ft.com
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