U.K. Mortgage Approvals Jump to 13-Year High After Lockdown
(Bloomberg) -- U.K. mortgage approvals climbed to a 13-year high in September as the housing market extended its tax-cut fueled boom.
Lenders signed 91,454 home-loan agreements, more than forecast and up from 85,530 in August, the Bank of England said Thursday. Consumers unexpectedly repaid debt during the month in a sign that Britons are turning more cautious as coronavirus cases surge.
The jump in mortgage approvals brings the average for 2020 to about 57,000, compared with 66,000 last year. That’s despite the near total shutdown of the market in April and May.
Pent-up demand and a temporary tax break on property purchases have lit a fire under the housing market in recent months but momentum is expected to fade as the economic outlook darkens.
Unemployment is rising and increasing areas of the country are back under tight restrictions in an effort to contain a resurgence of Covid-19. Many forecasters expect house prices to fall sharply next year.
Consumers repaid 622 million pounds ($810 million) more than they borrowed, mostly credit-card debt. Small and medium-sized non-financial businesses borrowed 1.6 billion from banks on balance, while large businesses repaid 5.8 billion pounds.
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