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Sunday 27th of December 2009
October 23, 2009    

New mortgage approvals back to 2007 levels

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by Gill Montia

The number of mortgages approved for house purchases by the UK’s leading banks rose again in September.

Figures from the British Bankers’ Association (BBA) show 42,100 home loans sanctioned for house purchases, up from 40,100 in August and a 77% improvement on a year ago.

Other mortgage approvals “remained subdued” last month and the Association concludes that “households are generally cautious continuing to reduce their borrowing and build up deposits”.

New mortgage approvals by High Street banks have now risen for the eighth consecutive month and the BBA claims that loans for house purchases have returned to a level last seen at the end of 2007.

However, the body’s statistics director, David Dooks, cautions that future housing market activity is dependent on more properties coming on to the market.

In related news, the Bank of England’s Trends in Lending survey, published earlier this week, revealed that the UK’s banks and building societies expect the availability of mortgages to improve in the months ahead.

Lenders said they were more optimistic about the economy and housing market and also expect falling default rates to contribute to a keener lending environment.

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