"The market is likely to experience a recovery in 2024, though it surely won’t reach the heady heights of 2021"
- Co-founder and CEO of GetAgent, Colby Short
UK mortgage approvals are set to fall by 24% in 2023 compared to the year before, according to estate agent comparison site GetAgent, which analysed monthly mortgage approvals over the past five years.
Between January and October 2023 an average of 47,602 mortgages were approved per month, which would bring the total to 571,219 if that trend continued in the final two months of the year.
This will be the second year in a row that mortgage volumes have fallen significantly, following a drop of 20% between 2021 and 2022, from 937,093 to 752,131.
From that peak in 2021 approvals are set to drop by 39% this year, amounting to 365,874 fewer mortgages.
Market to rebound in 2024
After the recent decision from the Bank of England to hold the base rate for a third consecutive time, the market is finally benefitting from some stability.
The cost of lenders’ funding is also falling, so mortgage rates could become more competitive as we enter into 2024, reversing the trend over the past two years.
Next year could be a better one than 2023, though GetAgent says it’s unlikely to reach the peak achieved in 2021 when the market was buoyed by the government’s stamp duty holiday and a record low base rate of 0.10% for most of the year.
Co-founder and CEO of GetAgent, Colby Short, commented: “There’s no getting around it, 2023 has been a difficult year for the property industry, as higher mortgage rates have dragged down people’s ability to buy.
“The one positive is the Bank of England has left the base rate unchanged since August 2023, which is helping people adjust to a new normal, as well as raising the potential for rate cuts in the new year.
“The market is likely to experience a recovery in 2024, though it surely won’t reach the heady heights of 2021, when the base rate was 0.10% and there was a stamp duty holiday for much of the year.”
