Official data from the Bank of England reveals that mortgage approvals exceeded expectations in October, indicating a potential stabilisation in the property market following an extended period of sluggish house sales.
Net mortgage approvals for house purchases rose to 47,400 in October, surpassing economists' projections of 45,000 and marking the highest level since July. However, this figure remains approximately 28% below the pre-pandemic level in October 2019.
Additionally, net approvals for remortgaging increased from 20,600 to 23,700 during the same period. Mortgage approval data serves as a timely indicator of the housing market's health, impacting the broader economy through home-related spending and consumer confidence.
The data suggests a moderation in the housing downturn, possibly influenced by a decrease in the cost of popular mortgage products following the Bank of England's decision to maintain interest rates at 5.25% in September and November.
According to the Bank of England, two-year fixed mortgage rates with a 60% loan-to-value ratio eased from 6.2% in July to 5.5% in October. Despite this, all popular mortgage products remained more expensive than in 2021.
In October, mortgage providers Halifax and Nationwide reported a month-on-month increase in house prices, although the average property was still less expensive than in the same month in 2022. The data also indicated a slight easing in consumer credit, which decreased from £1.4 billion in September to £1.3 billion in October