Mortgage approvals
UK Mortgage approvals are the key leading housing market indicator, in our view. A mortgage approval today typically leads to a housing transition in three months time. However, the current rush of activity in the housing market following a period of closure and the announcement of the Stamp Duty Holiday has led to bottlenecks in the system and transaction times have lengthened, but we expect a mean reversion at some point.
Latest UK Mortgage approvals
Key UK mortgage approval statistics and figures:
- July 2021: 75,152
- Down 6.4% on June 2021
- Up 9.5% on July 2020
- 5 year average 68,400
- 10 year average 64,925
- 20 year average 76,600
- Average since Oct 1986 83,600
Chart of recent UK mortgage approvals
The data for this chart can be found at the end of this article
UK mortgage approval commentary
Mortgage approvals in July 21 were 75,152 almost 10% above their level a year ago (68,641), but were 6.4% lower than June 21 as we reached the first of two Stamp Duty Holiday cliffs. However, the new stamp duty holiday threshold of £250,000 is still higher than the average UK house price as reported by the Nationwide in July of £244,229, so plenty of house purchases will still benefit from the stamp duty holiday. Mortgage approvals in July were 16% above their 10-year average and we expect them to remain above average until the stamp duty holiday comes to an end on 30 September this year, although with fewer mortgages in the £250-500,000 range. The Stamp Duty Holiday was extended from 31 March 2021 to 30 June 2021 with a further, although less generous extension from 1 July 2021 to 30 September 2021. The Stamp Duty holiday now applies to homes costing up to £250,000 rather than up to £500,000. However, the average house price in the UK is less than £250,000 according to the Nationwide Building Society, so plenty of homebuyers will still benefit from the Stamp Duty Holiday.
Chart of long term UK Mortgage approvals
Credit Conditions Survey
The latest Bank of England Credit Conditions survey (15 July 21) reported some very interesting dynamics in the mortgage market.The supply of mortgages is expected to increase and the price of mortgages (mortgage rates) continue to decrease in the coming months, which should stimulate demand. However, demand for house purchase mortgages is expected to decrease as the stamp duty holiday draws to a close. We may therefore start to see the housing market slow down as the wider economy opens up.
Future publication dates for UK Mortgage approvals
- August 2021 Data - 29 September 2021
- September 2021 Data - 29 October 2021
- October 2021 Data - 29 November 2021
- November 2021 Data - 4 January 2022
- December 2021 Data - 1 Februray 2021
UK Mortgage approval data since January 2018
| Date | Mortgage Approvals ('000) |
| Jan 18 | 66.9 |
| Feb 18 | 64.0 |
| Mar 18 | 63.6 |
| Apr 18 | 63.6 |
| May 18 | 65.0 |
| Jun 18 | 65.6 |
| Jul 18 | 64.9 |
| Aug 18 | 66.2 |
| Sep 18 | 65.6 |
| Oct 18 | 67.1 |
| Nov 18 | 64.5 |
| Dec 18 | 64.3 |
| Jan 19 | 65.9 |
| Feb 19 | 65.3 |
| Mar 19 | 62.6 |
| Apr 19 | 66.7 |
| May 19 | 66.1 |
| Jun 19 | 67.1 |
| Jul 19 | 68.7 |
| Aug 19 | 67.6 |
| Sep 19 | 66.6 |
| Oct 19 | 64.6 |
| Nov 19 | 64.4 |
| Dec 19 | 66.0 |
| Jan 20 | 69.3 |
| Feb 20 | 72.9 |
| Mar 20 | 56.7 |
| Apr 20 | 15.8 |
| May 20 | 9.3 |
| Jun 20 | 40.6 |
| Jul 20 | 68.6 |
| Aug 20 | 87.8 |
| Sep 20 | 93.2 |
| Oct 20 | 97.9 |
| Nov 20 | 103.6 |
| Dec 20 | 100.9 |
| Jan 21 | 96.8 |
| Feb 21 | 87.1 |
| Mar 21 | 82.3 |
| Apr 21 | 85.4 |
| May 21 | 86.2 |
| June 21 | 80.3 |
| July 21 | 75.1 |
Source: Bank of England
Bank of England Statistical Tables