Mortgage approvals lift in December 21

The Bank of England released the mortgage approval data for December 2021 this morning.

What they said

Mortgage approvals in December 2021 were 71,015

This was 4.7% higher than in November 2021

Mortgage approvals in December 2021 were 30% lower (down 30,200) than in December 2020

Twindig take

Mortgage approvals finished the year on an optimistic note rising by 4.7% in December 2021 to 71,015. Importantly, this is some 8% ahead of their 10-year average, which is a strong result given these mortgage approvals were not assisted by a stamp duty holiday. We had expected them to be more subdued as they nursed a stamp duty holiday hangover.

Our key takeaways are that homebuyers were still keen to buy with or without the stamp duty holiday (perhaps begging the question was it really needed...?) and lenders are keen to lend, suggesting that they are optimistic (or at least not too concerned) about the near term outlook for the UK housing market.

Mortgage rates may well rise in the coming months, and the cost of living is increasing, but the years of responsible lending resulting from the lessons learned from the Global Financial Crisis has prepared the housing market well for the impact of a global pandemic. For now, the housing markets foundations look strong, and an English person's home is looking very much like their castle.