Mortgage approvals at highest since Liz Truss’s mini-Budget cratered market two years ago
Mortgage approvals are at their peak since Liz Truss’s mini-Budget cratered the market nearly two years ago.
There were nearly 62,000 in July, up 29 percent in a year, the Bank of England reports.
The rise of 1,374 from June beat expectations and signals renewed confidence in the property market.
Mortgage approvals fell off a cliff from September 2022 as bond markets reacted to then-PM Ms. Truss’s unfunded spending plans.
The Bank’s aggressive rate hikes since to tackle inflation have meant mortgage costs are three times higher than they were in 2021, pricing out many wannabe buyers.
The Bank’s first rate cut in two years, from the 16-year high of 5.25 percent to 5 percent, has boosted hopes that they are likely to keep coming down.
Jonathan Samuels, boss of property finance firm Octane Capital, said: “It’s likely to act as a floodgate moment for the housing market, with more buyers looking to make their move.”
However, figures from Nationwide yesterday showed prices unexpectedly fell by 0.2 percent, or £950, in August.
Experts said affordability was still strained amid a summer lull.
On a more telling annual basis, the average house price is up 2.4 percent to £265,375, the fastest rise since 2022.
Robert Gardiner, Nationwide’s chief economist, said: “Providing the economy continues to recover steadily, as we expect, housing market activity is likely to strengthen gradually as affordability constraints ease through a combination of modestly lower interest rates and earnings outpacing house price growth.”
Bank cheque
The taxpayer’s stake in NatWest was cut from 18.99 percent to 17.9 percent yesterday, as the government offloaded more shares.
It comes a month after Chancellor Rachel Reeves ruled out a discounted sale to ordinary investors.
The stake is a hangover from the bailout of Royal Bank of Scotland.
Pastry wars
Holland’s Pies is going head-to-head with Greggs by recruiting its own “pastry taster.”
The Lancashire firm’s job ad urges its rival’s staff to jump ship in a North West v North East showdown.
Holland’s has been in business since 1851 and makes 900,000 pies and steak puddings a week.
Good week
Alex Kendall, co-founder of self-driving car tech firm Wayve, which attracted further investment from Uber.
Bad week
Will Gardiner, boss of Drax, which was fined £25 million for lack of data on its burning of imported wood pellets.