Net mortgage approvals for house purchases rose to 58,200 in June, up from 56,600 in May, according to the Bank of England’s latest Money and Credit report. The modest increase came alongside a small rise in remortgage approvals and a sharp jump in net borrowing, indicating a subtle shift in buyer sentiment.
Mortgage approvals and borrowing show mixed signals
Approvals for remortgaging with a different lender edged higher to 34,200 from 33,800 in May. More striking was net mortgage borrowing by individuals, which more than doubled to £7.7 billion in June from £3.3 billion a month earlier.
That figure exceeds the six‑month average of £4.9 billion, indicating that once‑off financing activity is picking up.
Nathan Emerson, CEO of Propertymark, said a consistent Bank of England base rate, competitive mortgage products, easing inflation and a temporary reduction in geopolitical tensions likely supported buyer confidence. He added that continued inflation easing should give households greater financial certainty, helping prospective buyers plan ahead, save for deposits and take advantage of more competitive borrowing costs.
Emerson also warned that “inflation is still above the Bank of England’s 2 per cent target, while higher household costs, including increased energy prices from 1 July, continue to place pressure on household finances.” Those cost pressures could temper the optimism suggested by the higher borrowing numbers.
Seller strategies adapt to a more balanced market
Iain McKenzie, CEO of The Guild of Property Professionals, noted that confidence is gradually returning but cautioned that approvals remain just below the recent six‑month average.
“Mortgage approvals are a useful indicator of future demand,” he said, “and while approvals for house purchases edged higher in June, they remain just below the recent six‑month average, highlighting that buyers are still proceeding with caution.”
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McKenzie described an “unusually early summer slowdown” driven by hot weather, geopolitical tensions and domestic political uncertainty. He said the market is now entering a more balanced phase, with buyers having more choice than they have had for some time.
For sellers, realistic pricing is becoming essential. Homes launched at the right price continue to attract interest, while overpriced listings often require reductions and linger on the market.
Nicky Stevenson, managing director at Fine & Country, highlighted that buyers are “spoiled for choice as more homes come to market,” giving them greater negotiating power.
Stevenson added that the market’s fundamentals remain sound despite lingering geopolitical concerns. A “significant cohort of non‑discretionary movers” who need to buy and sell regardless of wider economic conditions continues to provide an important foundation for activity.
The higher borrowing suggests that some buyers are ready to commit, yet the cautious stance of many consumers reflects ongoing cost pressures.
The market remains uncertain.
Balancing these forces will likely shape the market’s trajectory in the coming months.
