Mortgage approvals in June were over 30% up on the same month last year according to the latest stats from the Bank of England (see graph).
Approvals were pretty much unchanged from May, but showed a huge gain on the same month last year because June 2012 was an appalling month for mortgage lending (July and August weren’t much better). Then, the prospect of a full blown Euro crisis prompted UK banks to hold onto any cash they had to cover potentially huge loses on their loans to continental banks.
Without that threat hanging over them, banks and building societies have been steadily loosening the purse strings. It’s a graphic illustration of the importance of the Euro to the UK property market.
Approvals in the first six months of this year are over 25,000 higher than they were last year and the gain on the previous year should be even greater in the next six months. Even if mortgage approvals show no further improvement between now and Christmas, there would be in the region of 64,000 more approvals this year than there were in 2012.
It’s true, of course, that the improvement in lending this year has been modest so far and approvals have yet to reach 60,000 a month, but simply avoiding the reversals of last year has contributed to a substantial improvement in market conditions.
p.s. If you want to look at the original data from the Bank of England, you can find them here.