MNI: UK October Mortgage Approvals Recover From 6 Month Low

--October Mortgage Approvals 39,697 vs 38,712 September: UK Finance

By Jai Lakhani

     LONDON (MNI) - UK mortgage approvals reversed a trend of three consecutive

falls in October, rising to 39,697 from a six month low in September of 38,712,

UK Finance data published Monday showed.

     Whilst it is a move in the right direction, the October UKF figures add to

continued evidence that housing market activity is stagnant, as October's

reading still falls below June's 40,329. However, a positive sign is that data

is above the 12-month average of 38,927, with approvals a good indicator of

future house purchase levels. 

     Remortgaging approvals also rose, up to 28,419 from 27,998. This saw a

reversion to the mean after volatile movements in August and September. However

September's largest monthly fall since December 2017 has meant despite the rise

in October, the reading is still below the 12-month average of 29,011. 

     The net change in mortgage lending in October was stg1.495 bn, up from

stg1.477 bn a month before. A positive sign in line with mortgage approvals as a

whole is this breaks 3 months of net mortgage lending declining. Putting this

into perspective however, the reading remains significantly below the 12-month

average of stg1.740 bn. 

     "Overall mortgage lending grew in October, despite an uncertain economic

environment, while house purchase mortgage approvals by the main high street

banks were also up on the previous year," Eric Leenders, UK Finance Managing

Director for Retail Banking said.

     The impact of August's bank rate rise is appearing to have its effect on

remortgaging, with approvals softening. 

     "However remortgaging activity has softened, following a period of strong

growth driven by fixed rate loans reaching maturity and anticipation of August's

bank rate rise," he added. 

--MNI London Bureau; +44 203 865 3828; email: jai.lakhani@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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