LONDON Jan 24 British lenders approved more
mortgages in December than in any month since around the start
of the financial crisis, data showed on Friday, fuelling concern
that the housing market may be overheating.
Mortgages for homes purchases rose to 46,521 in December -
the highest level since September 2007 - from 45,394 in
November, the British Bankers' Association said.
The figures come one day after Bank of England Governor Mark
Carney told the BBC the momentum in the housing market was a
source of concern, even as he argued the central bank was in no
rush to raise interest rates.
"This provides further evidence of a more active housing
market, helped by growing consumer confidence and government
support schemes such as Help to Buy," BBA Director of Statistics
David Dooks said about the data.
Concern about the strength of the housing market prompted
the Bank of England and the government to say in November that
it would stop encouraging banks to lend to home-buyers under
their Funding for Lending Scheme. But the government's Help to
Buy scheme remains in place to guarantee low-deposit mortgages.
The data showed the number of mortgages was up 42 percent
from a year ago, although they remained below levels of more
than 70,000 seen in late 2006, before the financial crisis.
The fact that housing data were still below the levels seen
before the crisis was one reason the central bank was not doing
more to curb growth in the sector, Carney had said on Thursday.
"We took our foot off the accelerator, (but) we're not
hitting the break yet on the housing market because transactions
are three quarters of what they were before the crisis. The
longer-term average, mortgage approvals are about the same
level," he said.
"There is much more to the housing market as you are well
aware than just what is happening in London and in the South
East, and we have to make national policies," Carney said.
The pick-up in the housing market has accompanied a rapid
rebound in Britain's economy last year - one of the fastest
among industrialized nations.
BoE officials have stressed they have a range of tools to
rein in the property market if needed other than interest rates.
They said this week a rate hike is some way off, even though
the jobless rate has fallen close to the 7 percent threshold the
BoE had flagged for considering an increase in rates.
(Reporting by Ana Nicolaci da Costa; Editing by Larry King)