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Market News Topics
January 31, 2020 09:43 GMT
MNI POLICY: BOE: Mortgage Approvals Highest Since July 2017>
By David Robinson and Irene Prihoda
MNI (London) - UK housing market activity looks set to accelerate
as mortgage approvals rose to their highest level since July 2017 in
December, according to Bank of England data.
The data showed that mortgage approvals, a reliable indicator of
future housing transactions, rose to 67,241 in December from 65,514 in
November. The figures span the December 12 General Election and add to
the evidence that the UK economy may improve somewhat in the new year
after an apparently flat fourth quarter.
The following are key points from the BOE Money and Credit data
release:
-The rise in mortgage approvals to 67,241 took them above the
65,900 average for the past six months. The approvals should feed
through to actual home purchases in coming months.
Net mortgage borrowing in December rose to GBP4.6 billion, again
above the GBP4.2 billion average.
-The cost of borrowing for housing remains at, or close to, all
time lows. The average effective rate on new mortgage rose to 1.88% in
December from 1.87% in November, but on the stock of mortgages it fell
to 2.36% from 2.39%.
The prolonged period of ultra-low rates has driven the average rate
down to all-time lows, while new mortgages rates have fluctuated around
from month-to-month.
The rate on a fixed five year mortgage fell to just 1.97% in
December from 2.01% in November, the lowest on record.
-While interest rate on borrowing secured on housing has hit new
lows, the BOE data showed that rates on unsecured borrowing have risen
to all time highs.
The average rate on overdrafts and fee charging was quoted at
28.29% in December, the highest on record. Banks and other lenders
appear to have boosted margins on unsecured borrowing while the
competitive mortgage market keeps margins down.
-Despite high interest rate net consumer credit, a measure of
unsecured borrowing, rose to GBP1.218 billion in December from GBP0.653
billion in November, its highest level since October.
--MNI London Bureau; tel: +44 203-865-3812; email:
david.robinson@marketnews.com
[TOPICS: M$B$$$,M$E$$$,MX$$$$,M$$BE$]
To read the full story
Close
Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
Sign up now for free trial access to this content.
Please enter your details below.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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