BoE figures show that home buyers were given around 105,000 loans for purchasing new homes in November of 2020, up from 98,300 in October which marks the highest number since August 2007.
Pent up demand has been a driver behind the surge in numbers meaning that by November 2020, levels were almost parallel to figures from 2019, even though the pandemic literally halted the housing market earlier in 2020.
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Up to November 2020, there were 715,300 loan approvals for house purchasing compared with 722,000 from the same period in 2019 according to the BoE.
As well as pent up demand, the desire to move to a new location and the current stamp duty holiday have also been a motivating factor in the decision to purchase a new home.
Interest Rates are on the Rise
Earlier last year, the BoE lowered the base rate to just 0.1% bringing interest rates to record lows. This has meant that property investment has once again become an attractive proposition to investors following regulatory and tax changes which put many landlords off expansion of their portfolios. Cheap borrowing and the stamp duty holiday have reignited the property investment market as landlords take advantage of this lucrative time to invest.
Although mortgage rates are still lower than they were at the beginning of 2020, they are starting to creep back up and lenders have also increased their fees meaning that now may be the best time to secure a fixed rate mortgage.
Mortgage brokers are citing the end of 2020 as amongst the busiest closing stages they have seen and expect the trend to continue into the first Quarter of 2021.