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TODAY'S OTHER NEWS

Mortgage surge shows housing market is strengthening

In a new sign that the housing market is strengthening, mortgage lending increased in August by the largest amount since 2008.

Data from the Bank of England - which last week warned about possible volatility in the housing market in the next 12 months - shows that lenders approved the largest number of mortgages in more than a year and a half. 

Mortgage approvals for house purchases numbered 71,030 August, exceeding City analysts' expectations and up from 69,010 in July.

Adrian Gill, director of Your Move and Reeds Rains, says the figures show that "the mortgage market has certainly cast off the anchor of regulatory [MMR] changes" but warns that "buoyant demand is being met with a dried up pool of available homes, and this imbalance will propel property prices" for the rest of the year. 

"The mercury in the mortgage market is rising with August the third consecutive month-on-month increase in house purchase loan approvals. After feeling the chill of taxation changes more severely than other UK regions, house price growth in London is starting to show signs of reawakening" says Peter Rollings, chief executive of London agency Marsh & Parsons.

The Bank of England data also reveals that the number of approvals for remortgaging in August was 40,931, far above the average of 35,811 over the previous six months.

Last week the BoE's Financial Policy Committee said it expected house price inflation to pick up in the coming months and would be closely monitoring the buy to let market in particular. 

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