In June, the UK saw mortgage approvals largely unchanged, demonstrating resilience in the housing market despite rising mortgage rates.
The total number of net mortgage approvals for house purchases—a key indicator of future borrowing—stood at 59,976 for June, marginally down from 60,134 in May, as reported by the Bank of England on Monday. This was closely aligned with the forecast of 60,000.
Mortgage debt saw a significant rise, increasing to £2.7 billion in June from £1.3 billion in May, contrary to the expected decline to £1.2 billion.
Gross lending decreased to £20.8 billion from £22.6 billion the previous month.
The 'effective' interest rate on newly issued mortgages edged up by 3 basis points to 4.82%.
Consumer credit experienced a slight decline, falling to £1.2 billion from £1.5 billion in May, with the annual growth rate for all consumer credit easing to 8% from 8.4%.
In June, private non-financial corporations secured approximately £6.7 billion in finance, up from £4.2 billion in May. This increase was driven by £4.0 billion in net bond issuance and £3.6 billion in loans from banks and building societies.
The data suggests that the negative impact of higher activity levels is beginning to wane, which bolsters the view that the economic recovery might be more robust than many analysts predict, according to Ashley Webb, an economist at Capital Economics.
Webb also highlighted that the Bank of England is slightly less likely to reduce interest rates from 5.25% to 5.00% in its upcoming decision on Thursday, though the outcome remains uncertain.
