LONDON: Mortgage approvals for housing in the U.K. rose to the highest level in two-and-a-half years in September, according to figures from Bank of England. The central bank said Monday approvals for home loans reached 126,000 in September, against 120,000 in August and the highest figure since February 2004.
Economists said this is indication enough to show that the interest rate hike in August had not been able to dampen the housing market and there is now a clear possibility of another increase next week, when Bank of England's monetary policy committee meets to take a decision.
The housing market's buoyancy is being supported by a shortage in supply, according to analysts, who said the bank's figures suggested house price growth continues. The demand may lead to further pressure on house prices in the coming months, they said. But this will make it all the more difficult for first time buyers to get into the property ladder.
Property consultant Hometrack said house prices are rising at their fastest annual rate in two years in October. Even surveys by mortgage lenders Nationwide and Halifax have put the price growth at 8 per cent in September.
Total net mortgage lending to individuals rose by 9.9 billion pounds during September, which is an increase of 0.4 billion pounds on August.
The bank also said net consumer credit increased by 924 million pounds, higher than the forecast of 800 million pounds. Credit card borrowing rose by 365 million pounds, reversing a decline of 283 million in August.
