Mortgage approvals jumped more than two-and-a-half times in the second half of last year, with a rise in demand that has continued into 2021 seeing house purchases taking over three months to complete.
Homebuying approvals rocketed by 154 per cent in the second half of 2020, according to new data by online mortgage broker Trussle.
Pent up demand during the first lockdown and the government’s stamp duty holiday sparked the surge, it says.
However, the report adds that high demand has led to a backlog of deals as the industry struggles to complete transactions amid lockdown restrictions before the stamp duty holiday runs out at the end of March.
“The strong demand reported across the second half of 2020 has also carried into 2021 and, as a result of delays across the market, it currently takes 134 days to complete a property purchase in the UK,” the study says.
It points out that “next-time buyers” can save up to £15,000 if they complete their property purchase before 31 March.
The report compared mortgage approvals between the first and second halves of 2020 across the UK, and noted that the capital lagged behind growth shown among the highest performing regions.
Mortgage approvals in the West Midlands lifted by 244 per cent, by 236 per cent in the South West and by 214 per cent in the East Midlands.
By contrast, mortgage approvals grew by 147 per cent in London, “as the national lockdowns led people to reassess their love for city living,” says the report.
Trussle head of mortgages Miles Robinson says: “Appetite for property remained incredibly strong despite the unprecedented challenges presented by the pandemic, which placed many households under a huge amount of financial strain.”
Robinson adds: “Buyers opting to purchase homes in regional locations, which are typically more rural, was no doubt the property trend of 2020. The restrictions imposed during national lockdowns led many to prioritise more affordable bigger properties, with access to external space. But, only time will tell if this is a long term trend.
“If 2021 sees us able to return to some form of normality, old priorities of location over space and access to workplaces and amenities might mean people start flooding back into cities.”
