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| Version 1 | Version 2 |
|---|---|
| Surprise mortgage approvals jump | Surprise mortgage approvals jump |
| (about 1 hour later) | |
| Mortgage approvals for house purchases in Britain rose more than expected in February, according to official figures from the Bank of England. | Mortgage approvals for house purchases in Britain rose more than expected in February, according to official figures from the Bank of England. |
| There were 38,000 approvals in the month, up from 32,000 in January. | There were 38,000 approvals in the month, up from 32,000 in January. |
| There was also the biggest net repayment of consumer debt since records began in April 1993. | There was also the biggest net repayment of consumer debt since records began in April 1993. |
| Consumers repaid £245m worth of credit more than they took out in February, having taken on an extra £165m of credit in January. | Consumers repaid £245m worth of credit more than they took out in February, having taken on an extra £165m of credit in January. |
| The mortgage figures suggest that low interest rates and falling house prices may be encouraging people back into the market. | The mortgage figures suggest that low interest rates and falling house prices may be encouraging people back into the market. |
| "February's household borrowing figures suggest that housing market activity may finally have turned a corner," said Vicky Redwood at Capital Economics. | "February's household borrowing figures suggest that housing market activity may finally have turned a corner," said Vicky Redwood at Capital Economics. |
| "However, approvals have a long way to go before they get to levels that are no longer consistent with falling house prices - in fact they need broadly to double." | "However, approvals have a long way to go before they get to levels that are no longer consistent with falling house prices - in fact they need broadly to double." |
| Savings | |
| Separately on Monday, figures from the Building Societies Association (BSA) showed that mutual societies had received their highest net deposits on record. | Separately on Monday, figures from the Building Societies Association (BSA) showed that mutual societies had received their highest net deposits on record. |
| Building societies had £1,595m more deposited in them than was withdrawn in February. | Building societies had £1,595m more deposited in them than was withdrawn in February. |
| "Despite the Bank Rate being so low, people are still keen to save, probably in response to the uncertain economic outlook and reduced job security," said Brian Morris, head of savings policy at the BSA. | |
| Both banks and building societies saw their overall mortgage lending shrink in February, as customers repaid more of their mortgages than they replaced by taking out new loans. | |
| More lending? | |
| The rise in mortgage approvals by all lenders is a good short-term indicator of actual lending and suggests this may now pick up. | |
| February's figure was significantly higher than the average of 31,000 for each of the previous six months, and the biggest monthly figure since May last year. | |
| Simon Rubinsohn, chief economist at the Royal Institution of Chartered Surveyors (Rics), said interest from potential buyers was at last feeding through. | |
| "Accessibility to the market still remains a problem, with many first-time buyers struggling to find the necessary deposit," he said. | |
| "While it is likely that the numbers of mortgages being approved will continue to edge upwards over the coming months, the level of activity will still remain low by historical standards," he added. |