LONDON — Mortgage approvals in Britain struck a six-month high in January, according to official data on Tuesday that showed demand in the housing market remained strong despite the end of pandemic emergency support measures.
The Bank of England said lenders approved 73,992 mortgages, up from 71,219 in December. A Reuters poll of economists had pointed to 72,000 approvals.
The housing market has been hot in Britain – and many other countries around the world – since the lifting of the first coronavirus lockdown in 2020, boosted by demand for bigger properties as more people worked from home.
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The British market was also stoked by a tax incentive offered by finance minister Rishi Sunak which fully expired at the end of September, when a jobs support program also lapsed.
The BoE figures showed the value of mortgage lending – which follows mortgage approvals – rose in net terms by 5.92 billion pounds ($7.95 billion) in January, the biggest increase since September.
Consumer credit growth was weaker than expected at 608 million pounds, compared with the Reuters poll forecast for net lending of 1.05 billion pounds.
Despite a tough backdrop for the economy, with household budgets squeezed by soaring inflation and tax increases, analysts think the housing market will maintain some of its strength this year.
A Reuters poll last week pointed to house price growth this year of 4.0% and 3.0% next year, driven by a lack of homes coming to the market relative to demand. ($1 = 0.7451 pounds) (Reporting by Andy Bruce Editing by William Schomberg)
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