The mortgage market in the UK has reacted positively in the past year to changes in the regulations for the market which initially saw the number of loans approved falling, it has been reported.
The Bank of England said that in the first few months after the Mortgage Market Regulation (MMR) was initiated last April, there was something of a downturn in the number of approvals that were handed out by banks.
However, in the six months to the end of August this year, the bank said the number of mortgage approvals climbed by some 8.2 per cent as lending started to recover and lenders felt more comfortable dealing with the new stricter regulations.
The number of loan approvals for house purchase was 71,030 in August, up from an average of 65,594 in the six months that came before. In the same period, the bank said, remortgaging also increased, climbing by 14 per cent compared to six months before.
David Whittaker, managing director of Mortgages for Business, said that the changes in the last few months, particularly the fact that there had been so much more activity in the remortgage market, showed just how people's attitudes have changed and how borrowers feel more confident than they have in recent times.
"There is an ongoing shift to different sorts of mortgage lending, and a booming remortgage market reflects that interest in new products. Even compared to extremely buoyant house purchase approvals, remortgaging has picked up more quickly, reflecting ongoing expectations of higher interest rates on the horizon, as well as a newfound love for the peace of mind of fixed rate deals," he said.
Adrian Gill, director of Your Move and Reeds Rains estate agents, said it was encouraging to see the housing market as a whole move on from what had been a slower six months in the aftermath of the changing regulations, adding that the UK is now in a strong position when it comes to lending, thanks largely to the admirable way it weathered the storm of change.