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Mortgage approvals reach a five-year high

The Bank of England has confirmed the number of mortgages approved is at the highest level for the past five-and-a-half years.



Mortgages approved have reached 62,226 for the month of August which is the highest since February 2008 but remains significantly below levels in 2007.

Although the mortgage lending in August has increased to £1.0bn compared to the average of £0.7bn for the previous two years, it remains 40% lower than the pre financial crisis levels.

For home movers the advantage of leaving areas with rapidly rising property values to areas with lower growth is they may have extra equity for a deposit to buy a larger home or can reduce their mortgage.

Help to Buy Scheme

Despite the warnings of a property bubble being created by the government’s Help to Buy Scheme, there is little evidence of a boom.

The second phase of the Help to Buy Scheme supports first time buyers struggling to get on the property ladder.

After being brought forward by the government it starts in October and sparked fears of a new housing bubble.

Only the Royal Bank of Scotland and Lloyds Banking Group have publicly stated they would support the scheme designed to make it easier to buy a property.

A deposit of only 5% is required to find a home mortgage with a further 15% provided by the government scheme.

The Help to Buy scheme is not available to switching remortgage buyers or buy-to-let investors as it supports new home ownership to people struggling to get on the property ladder.

House price rise benefits

There are benefits for modest house prices to rise especially where values remain significantly below the 2007 levels. Increasing prices in certain areas would allow homeowners recover from negative equity.

Large price rises creating a housing bubble could undermine the economic recovery as the Office of National Statistics says the average home is £245,000, above the peak five years ago.

The rise in house prices allows the older equity release mortgage buyer to stay in their home while accessing the money in their property using this for home improvements, holidays or even reduce inheritance tax owed by your beneficiaries.

The Help to Buy Scheme would provide £12bn of government funds to support £130bn of mortgages. The scheme is now open to both first time buyers and home movers.

Buyers can place a 5% deposit on properties valued up to £600,000 and the fear is this will drive the average price of properties even higher.

What are your next steps?

Speak to our LCM mortgage advisers if you are planning to move home, buying your first home, remortgaging your existing home to a new cost effective mortgage deal or are a buy-to-let investor.

Start with a free mortgage quote or call us and we can take your details. Learn more by using the mortgage cost calculators, equity release calculator and property value tracker chart.

For equity release buyers our London City Mortgage brokers can recommend lifetime mortgages allowing you to receive cash from your property to help maintain your standard of living as costs rise.

Use your dashboard to access online mortgage quotes, money off vouchers and start your mortgage application online 24/7 on desktop, tablet or smartphone.


Mortgage Best Buys

These are examples of mortgage products we can approach with many more offering interest rates and flexibility to meet your needs.

1.19% Fixed Rate
60% Loan to Value
£999 App Fee
2-Years Time
Reverts to 3.59%
1.16% Fixed Rate
60% Loan to Value
£1,525 App Fee
Until 01/11/2022
Reverts to 4.09%
1.18% Fixed Rate
60% Loan to Value
£1,034 App Fee
Until 31/10/2022
Reverts to 3.59%
1.17% Fixed Rate
60% Loan to Value
£1,025 App Fee
Until 31/09/2022
Reverts to 3.59%

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  • IMPORTANT

    Equity Release may involve a Lifetime Mortgage or a Home Reversion Scheme. To understand the features and risks, please ask for a personalised illustration. Equity Release may affect your entitlement to means tested state benefits and will impact on the size of your estate. For Equity Release London City Mortgages charge a fixed fee upon completion of £695. For Mortgages a fixed fee is charged on application. Typically this is from £295 up to £495 for the services selected.

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