Purchase approvals reach 18-month high

The number of house-purchase approvals soared past 72,000 in June, the highest level since January 2014.

Figures from chartered surveyor e.surv’s Mortgage Monitor showed that approvals recorded the largest month-on-month increase in more than six years, with a leap of 12.8% on May’s figure of 64,434.

June’s number also represented a 10.5% annual rise.

Richard Sexton, director of e.surv, said: “This is the summer comeback we’ve been waiting for. Potential borrowers clearly paused their actions whilst the election came and went. But now borrowers are back in the market for mortgages and demand is stronger than ever.”

The survey also found that June had seen a rise in higher loan-to-value borrowers whose deposits represented no more than 15% of their property’s price.

There were 12,288 approvals for higher LTV house purchase loans in June, a 17.7% improvement on the 10,438 recorded in May and up 5.5% on the 11,646 seen in June 2014.

Sexton added that lenders had introduced a wider range of fixed-rate mortgage deals in response to expectations that the Bank of England base rate will remain low for the foreseeable future.

“The Mortgage Market Review has already tightened up the nuts and bolts, and lenders are now putting hands on deck to make sure they’re shipshape for the EU Mortgage Credit Directive peeking over next year’s horizon,” Sexton said.

“More positivity among buyers and lenders alike means the market is now on a stable course of sustainable lending.”