Mortgage approvals hit a 13-year peak

Approvals surged to 84,700 against a forecast of 73,000, as a flurry of activity and offers among movers raised the total to its highest peak since October 2007. Remortgage approvals remained relatively flat compared to July at 33,400.

But the increase of mortgage approvals to 30% compared to July chimes with other data showing a nascent recovery in the market, with Halifax and Nationwide recently showing rises in average house prices to a record level.

Hugh Wade-Jones, managing director of Enness Global Mortgages, the mortgage broker, said: “Despite a reduction in the availability of high loan-to-value products, we’re yet to see the level of mortgages approvals tail off due to overwhelming levels of buyer demand.

"Homebuyers at all price tiers are digging deep to come up with a larger deposit to secure a stamp duty saving, and although many lenders may be treading with caution, they continue to make hay while the sun shines."

Marc von Grundherr, director of estate agent Benham and Reeves, said: “We’ve seen little to no let-up in the volume of homebuyers hitting the market despite a tightening of finance options available.

“Where they may have been traditionally buying with a 15% to 20% deposit, they’re now stretching to as much as 30%. They are doing so to not only to take advantage of the favourable rates currently on offer but to secure a stamp duty saving in the process.

“Since the stamp duty holiday was announced, the number of mortgage approvals seen on a monthly basis has more than doubled, and so the boost it has given the market cannot be underestimated.”

The effect of the stamp duty holiday and pent-up demand across the mortgage market will be key themes at FSE-Week and the Lending Summit, in November.