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UK mortgage approvals hit 12-month high in January

Staff Writer |
The British Bankers' Association approved 44,657 mortgages last month, up from 43,581 in December and the highest number since January last year.

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House purchase approvals were down 2.5% compared to January last year but above the 2016 monthly average of 41,320.

Gross mortgage borrowing totalled £13.8bn, up 6.3% on January last year, while re-mortgaging approvals in January were 15.7% higher on the year at 28,862, driven by historically low interest rates.

Eric Leenders, BBA managing director for Retail Banking, said: "The new year saw homeowners make the most of historically low interest rates by taking advantage of competitive re-mortgage offers. Nearly 29, 000 of these deals were approved last month - 16% higher than January last year."

Howard Archer, chief European and UK economist at IHS Markit said: "Housing market activity has been helped off the lows seen around August by the resilience of the economy since June's Brexit vote and the Bank of England cutting interest rates in August and launching the Term Funding Scheme.

"Housing market activity had earlier slowed to its August lows after being buoyed in the first quarter of 2016 by buy-to-let and second home sectors rushing to beat April's Stamp Duty increase for these sectors. In addition, prospective house buyers faced a more uncertain economic environment following June's Brexit vote."

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