LONDON, Feb 28 (Reuters) – Britain’s housing market perked up firstly of 2018 with the sharpest enhance within the variety of mortgages authorised for home buy in almost three years, Bank of England figures confirmed on Thursday.
Britain’s economic system grew extra slowly on an annual foundation than all different Group of Seven nations within the closing three months of final yr, after customers have been damage by larger inflation brought on by the pound’s fall after the Brexit vote in June 2016.
The housing market has additionally been sluggish – particularly in London and surrounding areas – and main mortgage lender Nationwide stated earlier on Thursday that costs in January rose at their weakest annual charge since August, up 2.2 % on a yr earlier.
But the BoE stated the variety of mortgages authorised for home buy rose to 67,478 in January from a one-year low of 61,692 in December. This was the sharpest month-to-month rise since April 2015 and took the outright variety of approvals to its highest since July 2017, far outstripping economists’ forecasts of 62,000 in a Reuters ballot.
The central financial institution raised charges for the primary time since 2007 in November, reversing a reduce made in August 2016, and final month it stated charges would in all probability have to rise sooner and by barely greater than it had thought earlier than.
Economists polled by Reuters count on the BoE to boost charges to zero.75 % from zero.5 % by May, and monetary markets worth in a excessive likelihood of an extra rise to 1 % earlier than the top of this yr.
Governor Mark Carney final week stated charge choices would rely closely on how companies and households reacted to ongoing talks between London and Brussels on Britain’s deliberate exit from the European Union in March 2019.
Figures final week from trade group UK Finance confirmed British banks in January elevated the variety of mortgages they authorised for the primary time in 4 months.
In November British finance minister Philip Hammond reduce a tax on property purchases for first-time consumers in an try to assist youthful individuals get into the property market.
Reporting by David Milliken and William Schomberg