House prices were resilient in August as mortgage approvals grew (Reuters)
Mortgage approvals grew on the month in August as more Britons got their feet on the first rung of the property ladder, according to the British Bankers' Association (BBA).
House prices were reportedly robust across the month as demand in the market grew. Mortgage approvals are expected to rise steadily as stinging deposit requirements fall because of Bank of England credit easing efforts to help stimulate affordable lending to the UK economy.
The number of mortgage approvals for house purchases hit 30,533 in August, up from July's 28,750, reported the BBA.
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Net mortgage lending was up by £96m on the month before.
House prices in August grew by a "surprising" 1.3 percent in August, said Nationwide, lifted by more mortgage approvals and a robust labour market.
An average UK home costs £164,729, said the building society.
Halifax's house price measure showed a decline of 0.3 percent in the three months to August compared with the quarter before, showing resilience despite a worsening domestic recession.
"Overall, there has been little change in house prices so far this year with the UK average price in August at a very similar level to the end of 2011," said Martin Ellis, housing economist at Halifax.
"A gradual upward trend in spending power, aided by lower inflation, should help to support housing demand in the coming months."
Falling inflation and rising wage growth should make it easier for budding first-time buyers to save a deposit.
Some lenders have been asking people to front as much as 20 percent of a mortgage's value as deposit, a difficult task for most people given the dreary economic climate.
However the Bank of England has two credit easing schemes, launched in the summer, designed to bring down the cost of borrowing for businesses and consumers.
Banks can access discount-rate loans from the Bank of England to the value of their lending to smaller firms and ordinary people.
As their lending increases, so does the total value of cheap loans banks can get hold of.
This should offer a financial incentive to increase lending at an affordable rate.
Some of the biggest British banks, such as RBS, Natwest and Lloyds, have already said that their mortgage and business rates will fall.
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