Mortgage approvals in the United Kingdom have reached the highest in more than five years. According to the latest statistics, the number of new mortgages approved in the month of September is the highest monthly total in the last five years.
Information from the Bank of England
According to Bank of England, new mortgage approvals in the month of September were 66,735 compared to 63,396 in the month of August. This rise in number is believed to be mostly due to the declining interest rates on new and existing home loans.
Leading economists have said that even though the approval level are very high now, the mortgage market is still weak compared to how it was before the global financial crisis. This also means that there will not be a housing market boom, any time soon.
Help to buy scheme
It has been recently announced that Help to Buy scheme’s second stage is set to be launched by as much as three months, prior to the deadline. The first stage of this plan was launched in the beginning of 2013. The scheme aims at providing equity loans to buyers. The government has guaranteed partial loan to the banks to increase the number the number of loans. The success of the scheme has led the government to extend this benefit to buyers of existing home too.
Many economists believe that the Help to Buy initiative will increase the number of mortgage approvals even more by the year end.