Economic upturn drives huge rise in mortgage approvals

With figures showing that a record number of mortgage applications received approval in November 2015 – up 19% on November 2014 – the housing market is getting off to a promising start this year.

Largely due to the improved economy, banks and home-buyers have been given a confidence boost. On one hand, with mortgage rates hitting record lows, the idea of buying a house has become a lot less daunting for those looking to get on the housing ladder in 2016 or move to something more expensive. On the other hand, banks are lending more than they have in a long time.

The Bank of England statistics further reveal that the number of successful applications for remortgages in November 2015 was over 39,100, an increase of 25% from the previous November.

The number of loans for buy-to-let mortgages and remortgages rose in November 2015 to a combined 23,000 - a 46% rise when compared to November 2014.

There was also a significant 32% annual rise in December of small-deposit lending, where a homebuyer has a mortgage with a deposit of 15% or less of their property's value. These types of mortgages are a good representation of the first-time buyer market as these buyers often do not have the amount of savings needed for a larger deposit.

Stephen Ludlow, Chairman of ludlowthompson, comments: “Now is a really good time for prospective home-buyers to speak to lenders about getting a mortgage:  there is a greater sense of optimism in the air and this is being reflected in the number of mortgage approvals we are seeing.

"To take advantage of the rates on offer, buyers should be making sure that they have all the necessary paperwork to hand so that their application process runs as smoothly and quickly as possible.

"As interest rates look set to stay low for much of the coming year, there are plenty of attractive fixed rate mortgage deals out there. Banks and home-buyers alike should be enjoying this positive wave the market is experiencing."