Research shows that autumn is poised to bring an increase in mortgage approvals
New research suggests that there is a likelihood of increased activity during the upcoming autumn months. Over the last five years, mortgage approvals for September, October, and November have surpassed the overall yearly average by 7%, accounting for 27% of the total, surpassing both winter (26%) and summer (25%). Spring tends to be the least active period, with only 22% of approvals occurring between April and June.
The mortgage market is currently in need of a boost during the autumn season, as evidenced by the data. Mortgage approvals have declined by -23.7% year-on-year, with only 633,400 approvals in the past 12 months compared to 830,600 in the preceding 12 months. Recent trends show a continuing decline, with approvals in the last six months down by -14.7% compared to the six months prior, totaling 291,600 compared to 341,800.
There may be a turning point on the horizon, however, as there has been a gradual improvement in the last two months. Approvals increased by 3.2% in May and then by 6.9% in June, although the market still has a long way to go before returning to full strength.
Since December 2021, activity has been constrained by 14 consecutive base rate increases by the Bank of England, raising rates from 0.1% to 5.25% as a measure to combat inflation.
CEO of Octane Capital, Jonathan Samuels, commented:
“The mortgage market has had a mixed year, but activity could intensify in the months ahead.
Autumn is historically the strongest time of the year, and the approval count has already improved over the summer months.
Mortgage rates are steady and in many cases, now falling, which should help to spur on potential buyers.”
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