U.K. Mortgage Approvals Rise to Highest in More Than a Year

U.K. mortgage approvals rose to the highest level in more than a year in April in a sign the housing market is strengthening.

Approvals rose to 68,076, the most since February 2014, from an upwardly revised 61,945 in March, the Bank of England said in London Tuesday. Economists had forecast 63,500. The 6,131 increase on the month was the largest since February 2009.

Recent surveys have signaled that Britain’s property market will pick up momentum after the May 7 general election delivered a surprise decisive Conservative victory. That removed the possibility of an increase in taxes on the most expensive homes pledged by the opposition Labour Party.

Separately on Tuesday, Markit Economics said a measure of confidence in the construction industry rose to the highest in almost a decade in May. Its index of building activity rose to 55.9 from 54.2 and job creation accelerated.

“Business confidence across the construction sector picked up sharply over the month,” Markit said. “This was driven by signs of a post-election bounce in clients’ willingness to spend, which in turn supported a further sharp upturn in employment levels.”

The BOE said net mortgage lending -- gross loans less repayments -- was 1.7 billion pounds ($2.6 billion) in April and net consumer credit totaled 1.2 billion pounds. The effective interest rate on new mortgages fell 4 basis points to 2.64 percent. The rate on outstanding secured loans declined 2 basis points to 3.12 percent.

Loans to non-financial businesses fell 1.6 billion pounds in April from March. Lending to small and medium-sized enterprises declined 300 million pounds.

M4, a broad measure of money supply, rose 0.4 percent from the previous month and was unchanged from a year earlier. An underlying measure of M4 -- excluding so-called intermediate and other financial corporations -- increased 4 percent on a three-month annualized basis.

Non-residents bought a net 6.2 billion pounds of gilts in April following net purchases of 14.8 billion pounds in March.

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