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You can find the current article at its original source at http://www.guardian.co.uk/money/2013/jun/25/mortgage-approvals-high-upturn-housing
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| Mortgage approvals reach 16-month high fuelling hopes of an upturn | Mortgage approvals reach 16-month high fuelling hopes of an upturn |
| (3 days later) | |
| The number of mortgages approved by British banks rose by a quarter in the 12 months to May, but over the same period the value of outstanding loans secured on properties dropped by 0.2%. | The number of mortgages approved by British banks rose by a quarter in the 12 months to May, but over the same period the value of outstanding loans secured on properties dropped by 0.2%. |
| Seasonally adjusted figures from the British Bankers Association (BBA) showed the number of approved homebuyer mortgages reached a 16-month high during the month, at 36,102, as government attempts to stimulate the housing market appeared to gather momentum. | Seasonally adjusted figures from the British Bankers Association (BBA) showed the number of approved homebuyer mortgages reached a 16-month high during the month, at 36,102, as government attempts to stimulate the housing market appeared to gather momentum. |
| The average mortgage increased by £3,000 to £159,200, and the total value of approvals for house purchases rose to £5.5bn. | The average mortgage increased by £3,000 to £159,200, and the total value of approvals for house purchases rose to £5.5bn. |
| Remortgage activity also picked up, accounting for 20,675 approvals worth £3bn. | Remortgage activity also picked up, accounting for 20,675 approvals worth £3bn. |
| The figures add to the picture of an upturn since the start of the year, with Funding for Lending leading to a flurry of cheap mortgage deals and Help to Buy boosting interest in newbuild. | The figures add to the picture of an upturn since the start of the year, with Funding for Lending leading to a flurry of cheap mortgage deals and Help to Buy boosting interest in newbuild. |
| However, the BBA's data showed outstanding lending by banks continued to contract. In May, £9bn worth of capital was repaid by borrowers during the month, outstripping the £8.6bn of new loans. This is the fifth month running that net lending has been in negative figures. | However, the BBA's data showed outstanding lending by banks continued to contract. In May, £9bn worth of capital was repaid by borrowers during the month, outstripping the £8.6bn of new loans. This is the fifth month running that net lending has been in negative figures. |
| Some of the redemptions were a result of an increase in remortgaging. The BBA said these approvals among its members were up 17%, and on top of this, some borrowers will have switched loans to building societies. | Some of the redemptions were a result of an increase in remortgaging. The BBA said these approvals among its members were up 17%, and on top of this, some borrowers will have switched loans to building societies. |
| Matthew Pointon, a property economist at Capital Economics, said: "Mortgage approvals are gradually clawing their way back up after five years of very subdued activity, and government interventions are likely to mean this improvement continues." | Matthew Pointon, a property economist at Capital Economics, said: "Mortgage approvals are gradually clawing their way back up after five years of very subdued activity, and government interventions are likely to mean this improvement continues." |
| But he warned: "As recent events in the US highlight, market conditions can change quickly once support is withdrawn, and any house price gains are unlikely to be sustainable." | But he warned: "As recent events in the US highlight, market conditions can change quickly once support is withdrawn, and any house price gains are unlikely to be sustainable." |
| Unsecured borrowing also rose in May, although, again, there was a contraction over the year. Outstanding borrowing was down by 0.9% on May 2012's figure, driven by a 6.7% contraction in debt held in the form of personal loans and overdrafts. | Unsecured borrowing also rose in May, although, again, there was a contraction over the year. Outstanding borrowing was down by 0.9% on May 2012's figure, driven by a 6.7% contraction in debt held in the form of personal loans and overdrafts. |
| Credit card borrowing grew by 6.7% year-on-year and new spending on plastic totalled £7.8bn in May. | Credit card borrowing grew by 6.7% year-on-year and new spending on plastic totalled £7.8bn in May. |
| Howard Archer, chief UK economist at IHS Global Insight, said the increase in unsecured credit suggested that people felt "a little more prepared to borrow" than they did through much of 2012. | Howard Archer, chief UK economist at IHS Global Insight, said the increase in unsecured credit suggested that people felt "a little more prepared to borrow" than they did through much of 2012. |
| "It may also be that a recent increased squeeze on consumer spending coming from overall higher inflation and low earnings growth, means that some people are having to borrow more to finance any major spending," he said. | "It may also be that a recent increased squeeze on consumer spending coming from overall higher inflation and low earnings growth, means that some people are having to borrow more to finance any major spending," he said. |
| "Also, significantly, lenders are making more unsecured credit available." | "Also, significantly, lenders are making more unsecured credit available." |
| Top mortgages | Top mortgages |
| Chelsea Building Society | Chelsea Building Society |
| Yorkshire BS | |
| HSBC | HSBC |
| Provided by London & Country for the Guardian | Provided by London & Country for the Guardian |