Following the Brexit vote, approvals fell dramatically, but after a couple of months of stability, are now on the rise again.
In total, 64,407 mortgages for purchase were approved in November. While this was up from the 62,522 recorded in October, it is still some way down on 70,511 recorded in November last year and significantly below 2016’s peak of 72,512 approvals in February.
Richard Sexton, director of e.surv chartered surveyors, said that the “post-Brexit doom and gloom” in the market had now passed.
He added: “While activity is still down on previous years, the market is in a stable place, with record low mortgage rates continuing to lure buyers into the market.”
The importance of a large deposit
The report highlighted that borrowers with large deposits continue to drive the market, with more than 36% of loans going to borrowers with deposits of 60% or more.
In contrast first-time buyers and those with small deposits (defined as those with a deposit of 15% or less) made up just 16.3% of the overall market.
Sexton said that a shrinking first-time buyer market was a cause for concern, but suggested that after a period of lower-than-usual approvals, it could be a lagging effect.
“People at the top of the ladder must move first to free up properties for everyone else to move into. It is hoped that first-time buyer growth will resume as we head into 2017,” he continued.
The best regions for small-deposit borrowers
Northern Ireland was the best region for borrowers with smaller deposits, with 31.6% of all loans in the region going to these borrowers in November, followed by Yorkshire and the North West at 26% and 25.7% respectively.
At the other end of the scale, it was toughest for borrowers in Scotland if they only had a small deposit – just 11.8% of mortgages went to borrowers in this sector in November, even lower than London at 13.6%.