Mortgage approvals for February soared to 60,383, marking a significant rise from January’s figure of 56,087, according to the Bank of England.
This represents a robust month-over-month increase of 7.7% and a 39.8% surge year-over-year compared to February 2023, which recorded 43,207 approvals. This places mortgage approvals at their highest level since September 2022, when they reached 65,349.
February’s data also underscores a promising trend, as it marks the fifth consecutive month of growth in mortgage approvals. CEO of Octane Capital, Jonathan Samuels, said that we are now seeing this “initial indicator of market health return to levels not seen since 2022”. He continued:
“…before the market started to cool as a result of higher mortgage rates.
This is despite the fact that we’re yet to see an interest rate cut or any kind of buyer initiative introduced by the government, although there’s no doubt buyer confidence has been boosted by the prospect of lower interest rates on the horizon.”
Founder and CEO of easyMoney, Jason Ferrando, said that it was only a “matter of time before the market started to find its feet” and it would “appear that the nation’s buyers have now adjusted to the new normal where the higher cost of borrowing is concerned”. He added:
“All signs now point to a far stronger year for the UK property market and while higher mortgage rates remain an obstacle, it’s a matter of when, not if, they start to subside.”
Ruth Beeton, Co-Founder of Home Sale Pack, said:
“A surge in mortgage market activity bodes very well for the year ahead where the top line health of the housing market is concerned but improving market conditions bring other potential pitfalls.
While buyer confidence is building in anticipation of lower mortgage costs in 2024, higher demand will put further strain on a transactional process that simply isn’t fit for purpose in this day and age.
So although the nation’s sellers may find it easier to secure a buyer and for a higher price, they can expect the process itself to drag out for far longer. That’s if the sale doesn’t collapse before it reaches the finish line.”
On the same note, Co-founder and CEO of GetAgent.co.uk, Colby Short, said that the spring surge in market activity has “clearly begun early this year, with mortgage approvals climbing consistently”.
“This growing market momentum is only likely to build further as we enter what is traditionally the busiest time of year for the property market and, come the summer, we can expect to see these initial green shoots of buyer activity start to blossom into an increased level of sales completions.”
John Phillips, CEO of Spicerhaart and Just Mortgages, said:
“The positive momentum we have seen across the market is certainly continuing, as net mortgage approvals rise once again in February and to its highest point in 18 months. This certainly mirrors what we are hearing from our nationwide broker network, which reported a very busy February – even with half-term in the middle. In fact, our brokers did as much business in the first three weeks of February as they did in the whole of January – and January was a fantastic month.
With March bringing a strong end to the quarter, it’s encouraging to see that this is becoming more of a positive trend, rather than a new year bounce. Confidence is certainly returning to the market and affordability is showing signs of improvement. A significant drop in the effective interest rate paid on new mortgages is certainly helping.”
