House approvals increase 9.1pc
There were 65,778 purchase approvals in January, up from 60,275 in December.
But approvals have fallen for the last five months on an annual basis, as January’s figure was 12.9% lower than the same month in 2014.
Richard Sexton, director of e.surv chartered surveyors, said: “The new year has brought a new market, and lenders have a desire to return to growth.
“However, undoubtedly, some potential borrowers remain thoughtful about the approaching election and are playing a waiting game.
“The market’s young shoots of growth will continue to be guided, supported and at times restrained by a rigid structure of legislation.”
He added: “Whilst the Mortgage Market Review and LTI caps are preventing what has previously been perceived as higher risk lending, equally we have Help to Buy supporting and encouraging first-time buyers.
“With the announcement that the Bank’s Monetary Policy Committee is going to be given new abilities to place caps on LTV ratios, it looks like the purchase mortgage market could be closely managed and scrutinised in the run-up to the general election.”
Loans above 85% LTV picked up by 20.1% in January, as high LTV borrowers accounted for 15.3% of the market, up from 13.9% in December.
The largest proportion of high LTV borrowers were found in Yorkshire (28%), the North West (24%) and the Midlands (20%), while at the other end of the spectrum they had a smaller share in London (7%), Scotland (11%) and the South East (12%).
Sexton added: “Help to Buy is reaching the areas that need it most.
“Without Help to Buy stepping in to lift first-time buyers into the range of higher LTV loans, we can see that the north could be suffering from a real crisis.
“With a quarter of house purchase approvals depending on higher LTV lending in the North West – and even more than that in Yorkshire – the scheme is providing a lifeline for buyers otherwise priced out of the lower end of the mortgage market.”