Mortgage approvals reach six-month high

Mortgage approvals in the UK have reached their highest level in six months, Bank of England data showed on Tuesday. The Bank reported that the number of buyers receiving approval increased from 49,300 in November to 50,500 in December. Remortgaging approvals also rose from 25,700 to 30,800 during the same period. The rise in approvals is attributed to lower borrowing costs and an ongoing mortgage price war. The BoE data also showed the "effective" interest rate - the actual interest paid - on newly drawn mortgages fell six basis points to 5.28% in December, the first drop since November 2021. Thomas Pugh, an economist at RSM, the professional services firm, said falling borrowing costs suggested that "life may be starting to return" to the housing market. However, a fall of £830m in net mortgage lending was also recorded, far below the £250m rise expected by economists polled by Reuters. 

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