Mortgage approvals rise to one year high in June

A leading industry group has released data showing that the number of mortgage approvals for new property purchases in the month of June reached a one year high. The data was released last week by the British Bankers’ Association and showed that the number of UK mortgage approvals for June reached 31,747.

This figure for June was an increase from the 30,803 mortgage approvals that were seen in the previous month. It was also the highest value seen since July of 2010. Statistics Director from the BBA, David Dooks, said that banks were continuing to lend on mortgages for new property purchases but added that the mortgage market was still weak. He did state that there had been some level of revival in the buy to let market, with investors seeing the benefits of buy to let in the current climate where demand for private rental homes is at an all time high.

The results also showed that there had been a drop in net lending to non-financial companies, which fell by 2.5 percent. Officials said that this drop in net lending was partly due to low demand for credit from these companies, many of which are very wary about taking on further business debt in the difficult financial climate, with many preferring to try and pay down debt rather than take more debt on. However, this could have a significant negative impact on the growth of the economy according to many industry officials.

IHS Global Insight chief economist Howard Archer said: “It is likely a sign that companies are becoming increasingly wary about borrowing and investing in the current difficult economic environment – which in itself is worrying for growth prospects.”

Tags: british bankers association, month, new property purchases, economist, June, value