"The increase in mortgage approvals [between January and February] is welcome news and a sign that the housing market is beginning to improve."
- British Bankers' Association
The total number of new approvals for receiving mortgages in the United Kingdom increased in February of this year, by reaching the biggest level in five months. All in all, UK banks approved 37,305 new housing loans last month, up from 36,500 registered in the beginning of the year. However, annual data for this indicator continues to disappoint. Judging from year-to-year numbers, released by the British Bankers' Association, approvals for property purchases declined 20.2%, from 46,785 seen in February of the previous year. Alongside, a decrease in total value of new house loans amounted to somewhat lower 16.1%, partly positively offset by an increase in property prices across the country. Data has also showed a slump in a total number of all type of loans approved by British banks, down from 76,938 to 61,361 this February.
At the same time, BBA generally sees optimistic signs that a recovery is beginning to taking place, as consumers take advantage from competitive deals that are available at the moment. Britons are also becoming more confident to make long-term purchasing decisions as economy is getting back on track with the fastest GDP increase among G7 countries. Moreover, the UK government has set out additional plans to support those who are planning to buy their first homes. Last week, UK Chancellor of Exchequer George Osborne announced that the government will contribute 25% to deposits that should make a first payment for a new home purchase.
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