2 Mar

Mortgage demand remains strong

Mortgage demand remains strong

The number of mortgages being approved has reached a two-year high, according to the latest figures.

Data from the Bank of England show a total of 74,581 mortgages, with an overall value of £13.9 billion, were granted in January - the highest level since January 2014.

Howard Archer, chief UK and European economist at IHS Global Insight, believes the increase in mortgage lending could be a result of the forthcoming stamp duty changes.

Buy-to-let landlords are set to see a three per cent increase in stamp duty liability from the start of next month.

"This could well exert upward pressure on house prices in the near term. Post April, this move may modestly dilute housing market activity and upward pressure on prices,” explained Mr Archer.

There has also been a rise in consumer credit amounts, with the amount being borrowed increasing by £1.56 billion in January - reaching a total of £179.5 billion. This has led to speculation that debt levels are on the rise and this could have an impact on interest rates.

Samuel Tombs of Pantheon Macroeconomics, speaking to the Daily Telegraph, said: "British households are back to their old ways and are piling on debt again. With borrowing costs still falling, consumer confidence high and banks willing to lend, indebtedness will only increase unless the Bank of England acts."ADNFCR-1222-ID-801813833-ADNFCR

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