- Chris Williamson, economist at research firm Markit
Mortgage approvals in the UK reached the highest level in two years in January, while consumer credit rose at the quickest pace in a decade, according to the Bank of England. Mortgage approvals for house purchases increased to 74,581 last month from 71,335 in December. At the same time, consumer credit surged by 9.1% year-on-year in January, the highest since January 2006. The number of mortgage approvals increased throughout 2015, following a decline in the previous year when tougher checks on mortgage borrowers were introduced.
Britain's economic recovery is still heavily dependent on spending by households, many of which have been boyed by strong growth in the value of their homes. The central bank said it may raise the amount of money banks are required to put aside to cover their lending as the economy continues to recover from the financial crisis. The recent data from Rightmove showed the average asking price of property in the UK increased 2.9% in January, hitting another record high of 299,287 pounds. The report showed demand increased to record high levels, while the number of new properties coming to market advanced 5% when compared with January last year.
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