British mortgage approvals rises to highest since December 2009

British lenders granted 58,242 home loans in May, significantly higher than a revised 54,354 in April, hitting the highest since December 2009, said the Bank of England Monday. Economists had forecast an increase to 55,800 approvals in May from an initially reported 53,170 in April, according to the median of 22 estimates in Bloomberg News survey. The total value of mortgage loans approved in May increased by a substantial 853 million pounds (or 1.3 billion U.S. dollars) compared to April, to 14 billion pounds, the highest since October 2008, the data showed. The effective interest rate on new mortgage fell for the ninth consecutive month to another record low, supporting the housing market boom recently. The British house prices have risen at an annual rate of 1.9 percent in June, the fastest pace since September 2010, the National building society said last Friday in London. "The combination of record low mortgage rates and Government schemes to support housing demand has helped to boost the number of mortgage approvals," said Capital Economics, a London-based economic analysis company.