Mortgage demand is soaring on both sides of the Atlantic

US mortgage applications rose by 2.6 per cent in the week to 3 January. And last week's fall of 6.3 per cent has been revised up - to a more moderate decline of just 4.2 per cent.

Over on this side of the pond, the Bank of England said this morning that mortgage demand in the fourth quarter of 2013 rose to its highest level since 2007.

Mortgage Bankers Association (MBA) data showed that in the US 30-year fixed mortgage rates are now at three month highs, rising to 4.72 per cent.

Capital Economics:

The drop in mortgage applications in December reflects the increase in mortgage interest rates over the past two months. But if the wider economy continues to pick up speed during 2014 as we expect, then mortgage applications should recover.