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September Mortgages Highest in Years

Written By On 23/10/2013

A report from the British Bankers Association has revealed mortgage figures for last month hit their highest point for four years.

Loans taken out was up by a massive thirty nine per cent for the same period last year as property demand continues to grow.

Nearly forty three thousand mortgage loans were approved by lenders which was an approximate ten per cent increase on the previous month of August.

This sparks more fears that a property price bubble is being created and it doesn't help that there appears to be a shortage of property on the market. Some experts are putting this down to the government's new schemes in order to help people to buy their homes.

But panic may be a bit premature as the same report shows that the numbers are still only half of what they were nearly seven years ago, when the month of December approached the eighty thousand barrier for home loans.

Dr. Howard Archer, Chief European and UK Economist of the Country Analysis and Forecasting Group for IHS Global Insight feels that September's figures are a completely different scenario to 2006. Mr Archer said to bear in mind that

September mortgage approvals were still limited to 79.6% of their monthly average of 54,006 during 1997 to 2013.

The second phase of the Government's Help to Buy mortgage guarantee scheme was due to launch next January, but was brought forward by four months. Pointedly Dr. Archer said that property buying was increasing steadily previous to the next phase of the scheme being introduced.

No doubt that the Funding for Lending Scheme that was started three months ago has also had an effect on increase activity. The government encouraged lenders to offer loans by making available eighty billion pounds to financial institutions at very low rates.