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Loan approvals up 12% in February

Home purchase loan approvals increased by 12 per cent to 35,000 in February, according to figures released today from the Council of Mortgage Lenders.

The value of the house purchase loans advanced in February was £5bn, 9 per cent up on January’s figures and up 67 per cent on February 2009 figures.

Remortgage loans increased by 2 per cent to 24,000 in February, which represents the first increase in five months, but the figure is down 35 per cent on a year-on-year basis.

The trade body says January was weak due to one-off factors such as the effect of the end of the stamp duty holiday in December 2009 and the severe winter weather.

CML head of research Bob Pannell says: “With the supply of credit still tight and the upcoming election causing political uncertainty, we are unlikely to see much change in the near future although the new stamp duty exemption for first-time buyers could boost the market somewhat and we hope to see the traditional seasonal pick-up as the weather gets warmer and the days get longer.

“The start of the year is traditionally a quiet period for mortgage lending. This year though, transactions have been affected by the ending of 2009’s stamp duty concession and the harsh weather, making it hard to identify clear trends in recent months.”

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