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. October was an important month for UK mortgage approvals as it marked the first set of data we have had since the end of the stamp duty holiday. Mortgage approvals fell, as they were expected to, but not by as much as we may have thought.
Latest UK Mortgage approvals
Key UK mortgage approval statistics and figures:
- October 2021: 67,199
- Down 6.5% on September 2021
- Down 31.9% on October 2020
- 5 year average 68,800
- 10 year average 65,400
- 20 year average 76200
- Average since Oct 1986 84,400
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 October 2021 were 67,199 more than 30% below their level a year ago (98,678), but were 2.7% above their ten-year average of 65,400. Falling mortgage approvals is not a big surprise following the end of the stamp duty holiday. We would expect a lull in mortgage approvals for the rest of the year, before picking up again in the spring selling season. However, the recent discovery of the Omicron COVID-19 variant may cause the housing market (and therefore the mortgage market) to pause for breath whilst the extent of the new risks posed by the variant are assessed and calculated. 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 (14 Oct 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, although remortgaging activity is expected to pick up as homeowners seek to lock in low mortgage rates before they start to rise. We may therefore start to see the housing market slow down as the wider economy opens up.
Future publication dates for UK Mortgage approvals
- November 2021 Data - 4 January 2022
- December 2021 Data - 1 February 2022
- January 2022 Data - 1 March 2022
- February 2022 Data - 29 March 2022
- March 2022 Data - 4 May 2022
- April 2022 Data - 31 May 2022
- May 2022 Data - 1 July 2022
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 | 40.5 |
| Jul 20 | 68.2 |
| Aug 20 | 86.7 |
| Sep 20 | 92.7 |
| Oct 20 | 98.7 |
| Nov 20 | 104.5 |
| Dec 20 | 101.6 |
| Jan 21 | 97.5 |
| Feb 21 | 87.4 |
| Mar 21 | 82.6 |
| Apr 21 | 85.3 |
| May 21 | 86.0 |
| June 21 | 79.9 |
| July 21 | 75.5 |
| August 21 | 73.5 |
| September 21 | 71.9 |
| October 21 | 67.2 |
Source: Bank of England
Bank of England Statistical Tables