Home loan approvals at two-year high

The number of mortgages approved for people buying a home jumped to its highest level for more than two years during December, figures showed today.

A total of 45,897 loans were approved for house purchase during the month, double the number seen 12 months earlier and the highest figure since September 2007, according to the British Bankers' Association.

In a further sign that the housing market is continuing to recover, total mortgage advances rose by 6 per cent during the month to reach £10.2 billion, a level last seen in November 2008.

The group credited the jump, which came during a month when the mortgage market traditionally slows down, on people rushing to complete house purchases before the Government's stamp duty holiday on properties costing up to £175,000 ended at the beginning of this year.

But unsecured lending remained subdued in December and, while savings levels bounced back during the month, they remained weak for 2009 as a whole, as consumers instead focused on paying down their debt.









David Dooks, BBA statistics director, said: "The high street banks continued to lend substantial amounts in the weaker mortgage market of 2009, approving more than 440,000 loans for house purchase.

"Their share of gross lending went up from a historical level of about two-thirds to three-quarters, due to specialist lenders largely withdrawing from the market and building society finance contracting."



But despite expanding their market share, the major banks advanced a total of just £107 billion in 2009, down from gross lending of £170 billion in 2008 and £221 billion in 2007.



Approvals for all lending totalled 980,000 during the year, 27 per cent down on the previous year and the lowest figure since records in this format began in September 1997.



Despite the pick-up in house purchase activity, the number of people remortgaging remained subdued during December at 23,480, as low interest rates meant many people were better off staying on their lender's standard variable rate when their existing deal came to an end.



Repayments on credit cards continued to outstrip new spending in December, at £5.9 billion, compared with spending of £5.8 billion.



But once interest and charges were taken into account, outstanding credit card debt rose by £130 million.



Overall, new spending on credit cards during 2009 was nearly 10 per cent down on 2008, while repayments fell by 9 per cent but, due to the impact of interest, outstanding debt still rose by 8.8 per cent during the year.



Demand for personal loans and overdrafts continued to be weak in December, contracting by £475 million, the 13th consecutive month during which consumers have repaid more than they borrowed.



The amount owed through loans fell by £3.9 billion during 2009, while all consumer credit contracted by 2.2 per cent.



Savings levels increased by £3.6 billion during the final month of the year, following a weak November during which people set aside only £1.4 billion.



But new deposits for the whole of 2009 of £23 billion, were down on levels of £25 billion and £28 billion for 2008 and 2007 respectively, as people used their spare cash to repay debts.

Finacial products from our partners
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Guru Careers: Pricing Analyst

    £30 - 35k: Guru Careers: We are seeking a Pricing Analyst to join a leading e-...

    SThree: Trainee Recruitment Consultant

    £20000 - £25000 per annum + OTE £45K YR1: SThree: At SThree, we like to be dif...

    SThree: Trainee Recruitment Consultant

    £20000 - £25000 per annum + competitive: SThree: Did you know? SThree is a mul...

    Guru Careers: C# Project Team Lead

    £55 - 65k (DOE): Guru Careers: A unique opportunity for a permanent C# Develop...

    Day In a Page

    Fifa corruption: The 161-page dossier that exposes the organisation's dark heart

    The 161-page dossier that exposes Fifa's dark heart

    How did a group of corrupt officials turn football’s governing body into what was, in essence, a criminal enterprise? Chris Green and David Connett reveal all
    Mediterranean migrant crisis: 'If Europe thinks bombing boats will stop smuggling, it will not. We will defend ourselves,' says Tripoli PM

    Exclusive interview with Tripoli PM Khalifa al-Ghweil

    'If Europe thinks bombing boats will stop smuggling, it will not. We will defend ourselves'
    Raymond Chandler's Los Angeles: How the author foretold the Californian water crisis

    Raymond Chandler's Los Angeles

    How the author foretold the Californian water crisis
    Chinese artist who posted funny image of President Xi Jinping facing five years in prison as authorities crackdown on dissent in the arts

    Art attack

    Chinese artist who posted funny image of President Xi Jinping facing five years in prison
    Marc Jacobs is putting Cher in the limelight as the face of his latest campaign

    Cher is the new face of Marc Jacobs

    Alexander Fury explains why designers are turning to august stars to front their lines
    Parents of six-year-old who beat leukaemia plan to climb Ben Nevis for cancer charity

    'I'm climbing Ben Nevis for my daughter'

    Karen Attwood's young daughter Yasmin beat cancer. Now her family is about to take on a new challenge - scaling Ben Nevis to help other children
    10 best wedding gift ideas

    It's that time of year again... 10 best wedding gift ideas

    Forget that fancy toaster, we've gone off-list to find memorable gifts that will last a lifetime
    Paul Scholes column: With the Premier League over for another year, here are my end of season awards

    Paul Scholes column

    With the Premier League over for another year, here are my end of season awards
    Heysel disaster 30th anniversary: Liverpool have seen too much tragedy to forget fateful day in Belgium

    Liverpool have seen too much tragedy to forget Heysel

    Thirty years ago, 39 fans waiting to watch a European Cup final died as a result of a fatal cocktail of circumstances. Ian Herbert looks at how a club dealt with this tragedy
    Amir Khan vs Chris Algieri: Khan’s audition for Floyd Mayweather may turn into a no-win situation, says Frank Warren

    Khan’s audition for Mayweather may turn into a no-win situation

    The Bolton fighter could be damned if he dazzles and damned if he doesn’t against Algieri, the man last seen being decked six times by Pacquiao, says Frank Warren
    Blundering Tony Blair quits as Middle East peace envoy – only Israel will miss him

    Blundering Blair quits as Middle East peace envoy – only Israel will miss him

    For Arabs – and for Britons who lost their loved ones in his shambolic war in Iraq – his appointment was an insult, says Robert Fisk
    Fifa corruption arrests: All hail the Feds for riding to football's rescue

    Fifa corruption arrests

    All hail the Feds for riding to football's rescue, says Ian Herbert
    Isis in Syria: The Kurdish enclave still resisting the tyranny of President Assad and militant fighters

    The Kurdish enclave still resisting the tyranny of Assad and Isis

    In Syrian Kurdish cantons along the Turkish border, the progressive aims of the 2011 uprising are being enacted despite the war. Patrick Cockburn returns to Amuda
    How I survived Cambodia's Killing Fields: Acclaimed surgeon SreyRam Kuy celebrates her mother's determination to escape the US

    How I survived Cambodia's Killing Fields

    Acclaimed surgeon SreyRam Kuy celebrates her mother's determination to escape to the US
    Stephen Mangan interview: From posh buffoon to pregnant dad, the actor has quite a range

    How Stephen Mangan got his range

    Posh buffoon, hapless writer, pregnant dad - Mangan is certainly a versatile actor