Approved mortgage resumes to surge
Updated on 11 November 2009
The number of mortgages approved for people buying a home has resumed its upward trend during September, following a seasonal dip in August.
A total of 50,600 loans were advanced for house purchase during the month, 2% more than in August and 43% higher than in September last year, according to the Council of Mortgage Lenders.
The group said September was the third month in a row in which there had been a year-on-year increase in lending for house purchases, following 25 consecutive months in which lending had been lower than a year earlier.
But it added that although the recent bounce-back in housing market activity appeared to be holding up, transaction levels were still some way below normal.
The number of mortgages advanced to first-time buyers also rose during September, after falling slightly in August.
Around 19,700 people bought their first home with a mortgage during the month, 5% more than in August and 45% more than in September 2008.
First-time buyers continued to put down average deposits of 25% of their home's value.
But the average salary multiples that lenders advanced increased from 3.1 times a borrower's income in August to 3.15 times their pay in September - the highest level for a year, and a further sign that banks and building societies are beginning to loosen their lending criteria.
The CML said a third of first-time buyers avoided paying stamp during September as a result of the Government's stamp duty holiday on properties costing up to £175,000.
There were 6,200 mortgages advanced to first-time buyers purchasing homes priced between the old stamp duty threshold of £125,000 and the new one of £175,000 during the month, while a further 7,800 first-time buyers bought homes costing less than £125,000.
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