Today's Conveyancer: Approvals decline by 20% - how will this change in 2015?
Fri 02 Jan 2015
House purchase approvals in November 2014 were 20% lower compared to the previous year. Gross mortgage
borrowing in November 2014 was 10.1 billion - 5.5% lower than in the same month last year. Despite a
slowdown in demand, the overall mortgage stock continues to rise and is 1.6% higher than a year ago.
After recovering from a temporary bottleneck associated with the implementation of the Mortgage Market Review
earlier this year, recent figures show that overall approval numbers have been slowing. Future months will show
whether the stamp duty changes announced in the Autumn Statement will impact on the mortgage market. Compared to the same time a year earlier, approvals in November 2014 were:
House purchase -20%
Equity withdrawal -35%
Peter Rollings, CEO of Marsh & Parsons, comments:
"The contours of the UK housing market have shifted from the start of 2014, with property price rises softening
into a more organic upward curve. New configurations of affordability checks and pre-emptive measures in the
mortgage market temporarily diverted the route of lending, but overall progress is healthy.
"Mortgage products have never been more attractive, and with plentiful choice of properties and now smaller
up-front stamp duty costs, buyers are faced with a very favourable set of conditions. This has a knock-on effect
for sellers, as durable demand enables them to trade up, and this fluidity of movement at every level of the
market will ensure buoyant activity and optimism spills over into the start of next year."
Andy Knee, chief executive of LMS, comments:
"The latest stats from the BBA reporting a decline in house purchase and remortgage approvals - both down by
20% when compared to last year - appear to provide concrete evidence of a dramatic cooling in the marketplace.
But it may not be as simple as this and a number of factors including the time of year need to be taken into
"As evidenced by our latest Remortgage Report, 2014 has been an up and down year with the ramifications from
MMR, Help to Buy, tighter regulation and constant speculation about a base rate rise all being felt - and the latest
statistics from the BBA seem to support this.
"With the election looming next year, housing is likely to be a priority for all political parties and it will be
interesting to see how they tackle the challenges facing the sector. Further signs of a slowing in house price
growth will - on the whole - come as a welcome sign but for many, buying a house or upsizing remains far out of
"Going into 2015 there is hope for greater stability in the marketplace so long as uncertainty ahead of the election
does not play too large a role and economic conditions continue to improve. News of wage rises and a continued
decline in unemployment will also serve to boost conditions."