Property in 2023: Increase in Mortgage Approval rates

April 27, 2023

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uk property investment

Article Summary

Buy-to-let
  • According to recent data from the Bank of England, mortgage approvals have increased by over 15% in the past month alone.

  • The pandemic has prompted many people to reassess their living arrangements and priorities, with a greater number of people looking to purchase larger properties outside of urban areas.

  • The Help to Buy scheme provides equity loans to first-time buyers and home movers, enabling them to purchase a new build property with just a 5% deposit.

The UK housing market has experienced a significant uptick in recent months, with mortgage approval rates reaching their highest level in recent years. According to recent data from the Bank of England, mortgage approvals have increased by over 15% in the past month alone. This signals a buoyant outlook for property investors.

This surge in mortgage approvals can be attributed to several factors, including a recovering economy, low-interest rates, and government-backed schemes aimed at supporting first-time buyers. Additionally, the pandemic has prompted many people to reassess their living arrangements and priorities, with a greater number of people looking to purchase larger properties outside of urban areas.

London buy to let

One of the main reasons behind the increasing mortgage approval rates is the recovering economy. After the pandemic-induced downturn, the UK economy has been showing signs of recovery, with increased business activity and job creation. This has helped improve the financial health of households, making them more likely to secure a mortgage and invest in property.

Another important factor is the low-interest-rate environment. The Bank of England has kept interest rates at historic lows to support the economy, making borrowing cheaper for homebuyers. This has helped many first-time buyers get onto the property ladder, boosting demand for housing and driving up mortgage approval rates.

Government-backed schemes, such as the Help to Buy scheme and the Stamp Duty holiday, have also played a significant role in boosting mortgage approval rates. The Help to Buy scheme provides equity loans to first-time buyers and home movers, enabling them to purchase a new build property with just a 5% deposit. It helps investors secure a long term investment, giving them the opportunity to start their property portfolio.

The Stamp Duty holiday, which was introduced in 2020, temporarily removed the tax on property purchases up to £500,000. These schemes have helped make buying a property more affordable and accessible for many people, driving up demand and mortgage approval rates. The fact that this was extended in the 2023 Spring Budget is good news for first-time property investors.

The pandemic has also played a part in driving up mortgage approval rates. With many people spending more time at home, they have been rethinking their living arrangements and priorities. The desire for more space and outdoor areas has prompted many people to look for larger properties outside of urban areas, driving up demand for properties in these areas.

London buy to let

For property investors, these mortgage approval rates offer a positive outlook. With demand for housing on the rise, property prices are likely to continue to increase, providing opportunities for capital growth. Additionally, low-interest rates make borrowing cheaper, enabling investors to expand their property portfolios more easily.

However, it is important to remember that investing in property carries risks and requires careful consideration. Investors should do their research and seek professional advice before making any investments.

In conclusion, the increasing mortgage approval rates in the UK over the past month signal a positive outlook for investors looking for a prime property investment opportunity. The recovering economy, low-interest-rate environment, government-backed schemes, and changing priorities prompted by the pandemic have all contributed to the surge in demand for housing and mortgage approvals. While investing in property carries risks, the current market conditions offer opportunities for capital growth and expansion of property portfolios.

The right investment can bring in high rental yields through an astute buy to let investment, which, by using data-driven methods, can be found with North Property Group. To learn about the property investment opportunities above, or to find out more about how property investment works, get in touch with the experts at North Property Group today.

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