According to the latest BoE Money and Credit report, net mortgage approvals for house purchases increased from 60,497 in February to 61,325 last month, the highest since September 2022
Mortgage approvals continued to increase in March, official data released on Tuesday showed, to reach an 18-month high.
According to the latest BoE Money and Credit report, net mortgage approvals for house purchases increased from 60,497 in February to 61,325 last month, the highest since September 2022.
It was, however, slightly below analyst expectations for 61,500.
The effective interest rate – the actual interest paid – on newly-drawn mortgages dropped by 17 basis points to 4.73%.
Net consumer credit borrowing, meanwhile, rose to £1.58 billion from £1.43 billion in February. The rise was driven by net borrowing on credit cards, which climbed to £0.7 billion from £0.5 billion.
Net borrowing elsewhere, including car dealership finance and personal loans, was unchanged at £0.9 billion.
Households also deposited an additional £8.5 billion with banks and building societies, the highest net inflow since October 2022.
Peter Arnold, UK chief economist at EY, said: The recovery in mortgage demand continued in March. However, the interest in mortgage rates over recent months seems to have taken some of the momentum out of the recovery.
He added: With swap rates having jumped further during April, and mortgage rates continuing to edge up in response, the EY Item Club expects the recovery in approvals to continue to cool in the near term.
Stephen Perkins, MD at Yellow Brick Mortgages, said: Some weeks in March it felt like activity was starting to go through the gears, but the next week it stalled.
He said: With the Bank of England consistently stating rates will be higher for longer, and lenders starting each week by raising their rates, the market is not going anywhere fast just yet, he said.
He added: We really need that first rate cut from the Bank of England, which has the potential to ignite the mortgage and property markets.