BoE: Figures reveal unsurprising drop in mortgage approvals

Ryan Fowler

June 2, 2020

Bank of England figures have shown that the number of approved mortgages in April fell by 80% compared to February, to just 15,800.

The figures will hardly be a surprise for many with April having been in the middle of the market shutdown caused by the COVID-19 pandemic.

The figures show the number of approvals stood at around half that which were approved the worst periods of the global financial criss and the worst since records began in 1993.

Remortgaging faired better as it decreased by 34% to 34,400 from February.

Andrew Montlake, Managing Director at the UK-wide mortgage broker, Coreco, said: “Unsurprisingly, mortgage approvals went off a cliff in April as lockdown put the economy on hold.

“Since the lockdown was eased in mid-May we have seen a sharp increase in enquiries, reflecting the significant pent-up demand in the market right now.

“People had a lot of time to reflect during lockdown and many have now decided that they are keen to move to different areas of the country.

“We are seeing a sharp rise in the number of people looking to move to more rural areas given the perceived reduced risk from further potential surges in COVID-19.

“There is definitely more caution among surveyors but for now valuations are holding up fairly well given the strength of demand.

“Everyone is watching the economy and trying to predict how it will fare in the months ahead as the furlough scheme is gradually unwound.

“Whether valuations stay firm or collapse will depend on how the jobs market holds up during the summer and Autumn.

“Right now, with the economy propped up by the furlough scheme, we are feeling our way in the dark.”

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