The amount of money being lent by mortgage providers has dropped to the lowest it has been for seven years, excluding during the pandemic.
According to recent figures from the Office for National Statistics (ONS), mortgage values dropped from £2 billion to £0.7 billion in February, which is lower than it has been since April 2016.
This is despite the number of mortgage applications that have been approved by providers increasing by ten per cent. This is the first rise since August 2022, and shows things are looking up for housebuyers for the first time since the Mini Budget was announced in September, which saw mortgage rates soar.
Former Rics chairman Jeremy Leaf told This Is Money: “The first rise in mortgage approvals in six months gives a clear indication of where the market is heading, particularly after it took such a hammering in the final quarter of 2022 from rising interest rates and inflation.”
The data revealed mortgage approvals for house purchases rose from 39,600 in January to 43,500 the following month.
Additionally, mortgage rates have been declining over recent months, after peaking at 6.65 per cent for a five-year fix and 6.52 per cent for a two-year fix at the end of last year. These were five per cent and 5.32 per cent respectively in February, reaching six-month lows.
The figures come after the Mortgage Lending and Administration Return revealed the value of new mortgage commitments during the last quarter of 2022 was a third lower than the previous quarter and a quarter less than the year before.
For more help understanding the current state of the mortgage market, it is a good idea to seek mortgage advice from experts in Liverpool.