Mortgage approvals rose sharply in May according to the latest data from the Bank of England.
There were 58,242 approvals to purchase property (i.e. not including re-mortgages) in May, 7,000 higher than the same month last year and 4,500 up on the previous month this year. It is the highest number of monthly approvals since December 2009 (see graph).
Moreover, it is possible that the number of approvals is accelerating. Approvals for May were 8% up on the previous month, more than double the growth in approvals recorded in April (3.6%) and better than the increase seen in March (7%).
Lending in June, July and August last year was hampered by the Euro crises raging at the time, so approvals at roughly the current level in the next three months imply an increase in purchase approvals of 25% or more compared to the same time last year.
Approvals have yet to breach the psychologically important 60,000 a month (last seen in March 2008), but even approvals ranging from 55,000 to 58,000 a month would signal a huge improvement in mortgage availability and a significant increase in residential purchases.