A surge in lending for buy to let properties ahead of April’s stamp duty surcharge means mortgage approvals have reached their highest level in nine years.
January saw 85,432 house purchase approvals, up 20.6 per cent from the 70,837 in December according to data from e.surv chartered surveyors.
This is the highest levels for nine years and represents as annual increase of 39.3 per cent.
The substantial rise last month was fuelled by an increase in buy to let investors seeking to beat the imposition of the three per cent stamp duty surcharge from April 1.
“Many have predicted a narrowing of the buy to let sector but actually what we’re seeing in lending quarters appears to be the opposite. This buy to let rise also hasn’t been at the expense of first-time buyers. The number of small-deposit loans granted has risen in January, and this is a great sign that lenders still have the appetite to give first-timers a chance” explains Richard Sexton, director of e.surv.
The north west of England overtook the Midlands as the region with the highest proportion of small-deposit lending with a quarter of all house purchase approval lending to borrowers with small deposits. Yorkshire saw a small dip from 26 per cent of all lending made up of small-deposit loans falling to 24 per cent.
e.surv says the North continues to be a heartland for small-deposit borrowing and therefore first-time buyers.