The number of mortgage approvals for home purchases and remortgages increased in April, according to new figures from UK Finance.
Data published today revealed approvals by the main high street banks were 5.4% higher in April 2019 than in the same month of the previous year.
For home purchases, this figure was 8.6% more year-on-year and for remortgages it was 2.2% higher than in April 2018.
In the same period gross mortgage lending in the residential market was £20.3 billion, which was a fall of 1.4% year-on-year.
John Goodall, CEO of Landbay, said: “Mortgage lending remained subdued, and reflected the wider challenges facing the housing market.
“Lenders are having to push down mortgage rates for customers even as funding costs begin to rise, which has led to banks like Tesco bowing out of the market altogether.”
He added that while prices had started to stabilise, until there was clarity on the current political situation it was unlikely there would be any drastic rise in confidence, and subsequently, lending.
Meanwhile, Richard Pike, sales and marketing director of Phoebus Software, said the correlation between the gross mortgage lending figures, which were down, and the number of approvals, which were up across the board, was quite telling.
He added: “As house prices fall, especially in London and the south east, and house buyers also look farther afield into more affordable areas, this gap is only likely to widen.
It is, however, encouraging to see the increase in approvals for home purchase, which does show that people have had enough of sitting on their hands and are making their move.”
UK Finance also revealed 290,000 homeowners switched product with their existing provider in the first quarter of 2019, a decrease of 1.7% year-on-year.
In terms of value, it said this represented £39.2 billion of mortgage debt refinanced internally, which was an increase of 2.1% compared to the same quarter last year.
According to UK Finance, of the total number of product transfers in Q1 of 2019, 161,100 were on an advised basis – a rise of 8.6% year-on-year. These were worth £22.7 billion, an increase 15.3% year-on-year.
Execution-only product transfers went down by 12.1% year-on-year, to 128,900. These were worth £16.5 billion, a decrease of 11.8% compared to the same period last year.
By Kate Saines
Source: Mortgage Finance Gazette